A historian I respect - don't want to name him in case I accidentally misrepresent his ideas - has speculated that the Norse didn't mix with the Sami because having a separate tribe of hunters (no major reindeer farming back then) was useful to them. Almost like a caste. If people live side by side for 1000s of years, I think that's fair to speculate - there has to be a reason they didn't just assimilate into each other.

After the Danes returned to Greeland and first met the Inuit, the priests pushed for religious and cultural assimilation. Not strictly speaking linguistic assimilation, since they were good protestants who believed everyone had a right to hear the gospel in their own language, but it seems likely the language would have disappeared eventually if they got their way.

But the mercantile class in Denmark resisted development efforts, because if the Greenlanders became just another European people under the Danish crown, exploiting trade with them might become less profitable. People who were willing to live without European material comforts, such as they were, yet would sell you highly lucrative trade goods in return for comparatively little. The policy may have saved their language and culture, but at the cost of crippling economic development for a long time.

Maybe it was like that with the frontier/foraging Sami in the past, too. Kept apart in order to be easier to exploit economically. Though already in Harald Fairhair's day, it seems there were also Sami living among the Norse as boatwrights and smiths and maybe also as wandering professional hunters, hunting livestock predators for bounties - we know that kept going for a long time.

Another historian, which I will name - Johan Borgos - has written that the Lofoten islands were roughly 1 / 5 Sami, and that it was priests, the social elite, who first broke the taboo on marrying across the language barrier. Once they had done it, common people started doing it too, and so the language died out in that place. Not really from deliberate suppression effort (that came much later), but simply from "well, our parents speak different languages but most of the people we interact with speak Norwegian, so..."

Segregation can "work wonders" for preserving language and culture, but it's obviously often not a good thing. And to some degree, I think we have to respect our ancestors choices that they wanted bakeries, horn orchestras, cinemas, photography studios, tuberculosis sanatoriums, teetotaller lodges, baptists and salvationists, steam ships, traveling circuses, gymnastic competitions, revue theater etc. etc. in short everything modern, coded as "Norwegian" to them - rather than joik and reindeer and the few exotic things coded as Sami.