I also tried 12.1 beta 2 and had the same issue. I'm about to try Beta 3 and see if I get more luck.

From my tests it looks like only certified USB-C 3.1 Gen1 cables work properly on my MacBook Pro M1. Even Gen2 cables only run at USB 2.0 speeds.

From my tests it looks like only certified USB-C 3.1 Gen1 cables work properly.

Ok - so this wasn't just an external web cam issue for me, as I first thought. It appears that certain USB Hubs and cables are no longer working well with Monterey. My setup used to be USB3.1gen1 cable to Dell 4k Monitor (with built in USB 3.0 Hub) > USB 3.0 cable to Dell D6000 Dock > USB-C (not sure of the spec) cable to the Huddly IQ 4k WebCam. It appears the USB dock on the Dell monitor is no longer running at 5Gbps on Monterey. But also certain USB-C cables that used to work with the camera (or other devices) plugged in directly to the MacBook now no longer work either. This includes the genuine apple USB-C cables that I had to hand. I swapped out all the cables with brand new USB-IF certified cables and changed my setup so the D6000 dock is now directly plugged into my M1 via USB-C 3.1gen1 and the dock then connected to the webcam similarly (slightly annoying as now I have to plug in two cables, rather than one) - the camera now connects at 5Gbps and is working. I have tested other devices too and they had also dropped from USB 3.0 'superspeed' 5Gbps or USB 3.1 (5Gbps or more) down to old school USB speeds of ~480Mbps. The 4k USB-C camera just didn't work connected at those speeds. So about £50 spent on cables and still not back to where I was, but at least my setup works again in this new configuration. No idea why the hub in the dell monitor isn't playing ball.