No, this isn’t a states rights issue. States can put whatever they want on their driver’s license. The Feds have put out requirements for what they require to get through federal security (Federal building, military base, etc. If your state doesn’t want to meet those standards, no problem. You just need to get a qualifying federal ID (Simplest and cheapest probably being a Passport Card).
They even had to re-vamp the federal employee id cards a few years ago to add an expiration date and biometric information.
In the past every state honored the driver's licenses of every other state. The Feds did as well.
Now the Feds are saying that they will not honor the driver's licenses of some states, i.e. they do not grant certain states 'full faith and credit'.