Thanks @Sweeper!

.presentationSizing(.page) works smoothly.

Posting an extension for those who will support new sheet on iPad iOS 18.0+:

struct SheetOrPageModifier<PresentedContent: View>: ViewModifier {
    @Binding var isPresented: Bool
    let onDismiss: (() -> Void)?
    let viewToPresent: () -> PresentedContent

    func body(content: Content) -> some View {
        if #available(iOS 18.0, *) {
            content
                .sheet(isPresented: $isPresented, onDismiss: onDismiss) {
                    viewToPresent()
                        .presentationSizing(.page) // Page presentation on     iOS 18+ on iPad
                 }
         } else {
            content
                .sheet(isPresented: $isPresented, onDismiss: onDismiss, content: viewToPresent)
        }
    }
}


extension View {
/// Presents a sheet or page based on the iOS version.
///
/// - Parameters:
///   - isPresented: A binding to whether this sheet is presented.
///   - onDismiss: An optional closure to execute when the sheet is dismissed.
///   - content: The content of the sheet.
/// - Returns: A view that presents a sheet or page when `isPresented` is `true`.
    func sheetOrPage<PresentedContent>(
        isPresented: Binding<Bool>,
        onDismiss: (() -> Void)? = nil,
        @ViewBuilder content: @escaping () -> PresentedContent
    ) -> some View where PresentedContent: View {
        self.modifier(SheetOrPageModifier(isPresented: isPresented, onDismiss: onDismiss, viewToPresent: content))
    }
}