Oh, installing elogind and xorg meta package has solved few issues.
Somehow I was always installing only xorg-minimal and xinit for Xorg setup, later getting parts which I needed, but xorg meta package has helped me.
At this point when I start sddm, I am still sort of in tty1 view, but I am in tty7 with a working mouse cursor
Still sddm-helper exits with 11, but now it gives me more info in dmesg (latest 5 lines):
[ 6.357045] IPv6: ADDRCONF(NETDEV_CHANGE): eno1: link becomes ready
[ 13.947724] elogind: New session 1 of user root.
[ 41.274981] elogind: New session c2 of user sddm.
[ 41.467965] sddm-greeter: segfault at 7f0cf2261770 ip 00007f0ce68f4ff6 sp 00007f0cf2261760 error 7 in nouveau_dri.so[7f0ce65a4000+c1c000]
[ 41.485660] elogind: Removed session c2.
Seems that sddm-greeter does not like something about nouveau dri… not sure how to continue.
Any ideas? Is it possible to use nvidia closed source drivers on musl version or is it only glibc compatible?