Unsurprisingly, the same report from Eurogamer says Nintendo Switch will be more capable when plugged in at home than when it's in mobile form.
There's a simple reason for that: Power! As in electricity. Mobile gaming platforms — the original Game Boy straight through to the Nintendo 3DS, and your iPhone too — are limited tremendously by their reliance on batteries. Spend an afternoon playing "Minecraft" on your iPhone and see what happens to your phone's battery.
As a result, the companies that make mobile hardware — Apple, Nintendo, Sony, etc. — intentionally build their hardware to balance horsepower with power use. You could make a super powerful phone, for instance, but the battery required to power it would be massive. So instead of doing that, they sacrifice horsepower for battery constraints. That constraint is removed, though, when you're plugged in to a "limitless" power supply (the wall).
All of which is to say: When you dock the Nintendo Switch at home, it can "turn on" horsepower that it otherwise doesn't use (in order to save battery life when on-the-go). It's up to game developers to choose how to use that extra horsepower, of course.