One thing though - I am running agent on behalf of a regular user.

Oh that might be credentials / docker service issue (i.e. the user might not have the ability to rn a docker with --gpus, but as you mentioned,, that seems like an arch thing 🙂 )

Yeap. That's an arch thing but in case of arch --gpus is not enough.
One thing though - I am running agent on behalf of a regular user.

Makes sense to add it to docker run by default if GPUs are mentioned in agent.

I think this is an arch thing, --privileged is not needed on ubuntu flavor, that said you can always have it if you add it here:
https://github.com/allegroai/clearml-agent/blob/178af0dee84e22becb9eec8f81f343b9f2022630/docs/clearml.conf#L149

clearml-agent daemon --gpus 0 --queue default --docker
But docker still sees all GPUs.

Yes --gpus should be enough, are you sure regrading the --privileged flag ?