A GTX970 and no DisplayPort? Forget using it with a UHD monitor...
Even without DP, GTX 970 supports HDMI 2.0, which can output UHD at 60 Hz.
Will it support Steam OS?
SteamOS is nothing but a fork of Debian. Provided that you are using a recent enough kernel (at least 3.11 is required for proper Haswell support) and compatible graphics drivers from AMD/nVIDIA (depending on the GPU), any Linux distribution should work just fine.
It's about getting as much power in as small as space possible while maintaining quiet noise levels and appropriate temperatures.
Correct, but I fear I have to agree with
Bloodklot and
Haravikk. Steam machines present little interest for most PC gamers due to their low value for money and won't convert any console users no matter how hard they try, because the most used console users' excuse I hear nowadays is that they don't want to leave the platform all their friends play on. Even if they get over their laziness (can't call refusing to "deal with OS, drivers and hassle" on a modern OS nothing else but lazy) and pony up the extra cash, they'll still be annoyed because all their friends bought the next CoD for their Xbox. PC gaming is for people with a different mindset - those who are not bound by what their friends prefer and not afraid to learn new things and improve their gaming experience through them. Steam machines do nothing to change that.