NVENC hardware acceleration and H264 - not supported anymore?

Hello everyone

I've been using Premiere Pro with my Nvidia GTX 2080 Super and i9-9900k, encoding with CUDA in H264 for almost a year now (I edit VR video for work)

now the new NVENC update promised groundbreaking support for hardware acceleration on Nvidia cards with 3x faster encoding.. great!

well.. thing is, trying to encode with my usual, unchanged OLD reliable settings, with the NEWEST Nvidia driver, there's no way I can encode because Premiere says "your system hardware does not support hardware acceleration" for the current export settings (WHAT? I've been using these exact same settings with this exact same hardware countless times in the last year)

so to use "hardware acceleration" I'm forced to choose H265 instead (which is not what I want because it's not as compatible) and it's also way slower than H264

although if I choose "software acceleration" and continue with my old settings, then in Media Encoder the renderer is Mercury hardware CUDA, but in task manager the process uses 100% of the CPU and only about 35% of the GPU.. (which seems pretty much exactly like before the new NVENC hardware acceleration update..

WTF? Any ideas?

I'm just adding now that I am NOT using VBR 2 pass, my settings are VBR 1 pass, so what was marked below as "correct answer" is not actually the solution