While I wanted to get back on the stable track until next June, bit the bullet and upgraded to the 12.1 beta in hopes that would fix this Network panel issue. Thankfully it does. Upgraded and now Network Preferences properly shows the ethernet as green/connected. For those on the stable version, perhaps someone will have a workaround to suggest here in the meantime.
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Also just tried plugging it direct to the Mac to rule out the OWC Dock as being part of the issue specific to M1, but same issue when connecting direct. Tried deleting the thunderbolt bridge and re-adding in the Network panel and restarting and no resolution. Also if it matters using the pluggable 2.5g thunderbolt ethernet for the past couple years with no problems. It's based on realtek I believe.
I'm on the latest Apple TV beta and the latest iOS 14 Beta 3 just released and there is no " Settings -> Video and Audio -> Default Audio Output". Also don't see the option on iOS in settings, or in home > Homepod > settings or home > appletv > settings. In other forums others all note it's missing yet some do see it.