It could be the cpu getting maxed out on some thread. Keep an eye on your CPU core utilization while playing.
Unless afterburner is nerfed, (which it may be in this game. I'll get to that) it isn't a CPU issue. I added all threads to be displayed. While the 5600 at 4.65GHz is working hard, none of the threads goes over 90% usage. CPU stays in the 40-70s% without RT on.
I was able to replicate the freezing issue. Mine didn't last as long. Conditions necessary: if I used the high or very high preset at 1080 and swing fast near street level where it's busy, it happened more than once.
ARC usage never goes over 70-80%. Spends most of the time in the 50s-60s. Nothing changes up high away from traffic and crowds either. Though the fps drops from 60 to as low as the 40s on the streets. That may be the CPU bottleneck. Or the game and drivers are not working together fully?
XeSS looks remarkably good. I set it to ultra quality and I could not tell it was on, other than the small improvement in frame rate.
On afterburner maybe being nerfed: Along with the low reported GPU usage, it claims almost 9GB allocated and almost 7GB used. If I set it to very high it goes over 10GB allocated, but the amount being used doesn't change from approx. 6.7GB. Ram allocation is over 13GB but used is only 6-7GB or so. Either it's nerfed, or the Intel drivers are nerfed. Intel is the prime suspect obviously.
Game is fully enjoyable with RT reflections on high using XeSS quality or FSR 2.1 Quality with sharpness slider on 5. Both look great. XeSS could use a sharpness slider, it looked a bit soft testing in the snowing section of the game. FSR with the sharpening had a cleaner look.