After some more experimentation I found that the issue was caused when updating to Visual Studio 2022 v17.11.6, but the release window was so short between that and v17.12 that I likely never tried to edit a Form/Control in the designer, so assumed it was v17.12 that caused it.

As we don't have a good reason to target a specific version of Windows, we have decided to alter the TargetFramework to be "net8.0-windows" for all our projects and that does seem to resolve the issue we are having with the Forms Designer.

However, I'm sure there are plenty of people out there with good reasons to be targeting a specific version that may also run afoul of this issue, so hopefully Microsoft will address it in an upcoming release.