@PotomacBobI'm not really versed in all the math and methodology involved, but in my profane understanding it is indeed believed to be "better" at least somewhat.
Well, if all the polls you average are using the exact same methodology, and were conducted at the same time, the resulting number would be legitimate new result of simply larger sample and thus the "correct" one, and would even enjoy (much) smaller margin of error.
In reality the polls are each done by different methods at different times, at least some pollsters have known partisan biases and so forth. You may end up averaging the only accurate poll with bunch of bullshit pulled out of someone's ass. So, a simple mechanical averaging, while still in theory may give you a somewhat more trustworthy number than any single poll could, doesn't fully make sense.
538 try to account for all that with a known systematic bias adjustment and also assigning weights to individual polls by historical accuracy of the pollsters and age of the poll, and sometimes drop polls out for suspected fraud. (For example, they just dropped out last Trafalgar polling, not so much for being exceptionally weird even by usual Trafalgar standards, but for suspected data manipulation; on what Trafalgar responded by cutting public access to data of that poll, so...)
Such a number isn't quite an average, and possibly better be called projection, but if all done right it in theory can be more "true" than even pure average (all that is public on their site, with some digging). 538 then further adjust that number by their own data points to arrive at the figure they then use to assess their probabilistic forecast. And, yes, that whole process has quite few degrees of freedom that may introduce a bias. (With, while would normally assumed to be Democratic for the personalities of the staff there, was regarded to be at least a little pro-Trump by the assumptions inherent in their fundamentals. That component though is quickly losing weight at this late phase.)
RCP does more plain pure average. However, they do at least some cherry picking of polls to average, and their methodology to do that isn't at all clear. There normally is assumed at least light conservative bias, but it seems this cycle they are going all out into Trumpland, including phasing out aging good polls showing Biden lead more quickly than probably is reasonable. It still may be useful as kind of worst case average (from a Biden supporter viewpoint).