I was looking for the entire file compressed into a zip file and attached to a reply post. The relationship of the Thunderbolt devices is important. Here's a screenshot from IORegistryExplorer.app for an M1 Mac mini from 2021. It shows two DP In Adapters per Thunderbolt port.
View attachment 2459701
DSC should not be required if the displays use less bandwidth than Thunderbolt 5 supports.
Three 4K60 displays should work. They use HBR2 x4 which is 17.28 Gbps. x3 = 51.84 Gbps. 5K60 and 6K60 displays that use DSC will use HBR2 x4.
Three 4K120 displays might not work if they don't use DSC. They use HBR3 x4 which is 25.92 Gbps. x3 = 77.76 Gbps. Hmm. Seems like it should work since it's less than 80 Gbps. Or it should switch the Thunderbolt 5 output to asymmetric mode (120 Gbps transmit, 40 Gbps receive).
If a display doesn't use DSC, then you might be able to force a display to use DSC by connecting it to a DisplayPort MST Hub that supports DSC. The MST Hub might use HBR3 x4 though, unless you force it to use HBR3 x2 - by disabling two of the SuperSpeed pins, or by using a USB-C dock that supports MST and USB 3.x. The CalDigit SOHO is such a dock but it's DSC mode does not support 10bpc decompression for displays that don't support DSC.