A few more observations:
The file search results do indeed include folders - but only the ones in the user directory. Nested folders do not show up
The search results do not include files - even when located directly in the home directory.
Console logs didn't show anything very obvious but adding a few relevant lines here to be able to rule out a few things
No obvious errors or warnings
TCC seems to be happy and full disk access is indeed being granted (explains why resetting it doesn't help I guess)
access info 16:20:41.106914+0100 tccd Handling access request to kTCCServiceSystemPolicyAllFiles, from Sub:{com.runningwithcrayons.Alfred}Resp:{<TCCDProcess: identifier=com.runningwithcrayons.Alfred, pid=4738, auid=501, euid=501, binary_path=/Applications/Alfred 4.app/Contents/MacOS/Alfred>}, ReqResult(Auth Right: Allowed (System Set), DB Action:None)
access default 16:20:41.106946+0100 tccd AUTHREQ_RESULT: msgID=331.213, authValue=2, authReason=4, authVersion=1, error=(null),
access info 16:20:41.107225+0100 tccd REPLY_MSG: msg={
auth_value=2 (0x2)
result=true
auth_version=1 (0x1)
auth_reason=4 (0x4)
}