It came back after I stopped lsws, killed all lsphp processes, and restarted lsws. Will probably go away again at some point. At least that has been my experience. Works after restart only for a while.
FYI This has been root-caused to a OLS bug in v1.7.* (not sure about v1.6.*) that happens on (at least GUI) restart when the server socket is recovered. It does not happen when doing a start from clean when nothing is running.
The bug prevents the alt-svc header from being added for new requests. This means existing http/3 connections will continue to work but no new http/3 connections will get initiated. Which is consistent with all my observations.
The fix should be coming soon-ish, most likely in v1.7.7. Thanks to David from support for working with me to resolve this issue