iPadOS behavior with secondary displays is inconsistent.
Firstly, Apple has not published what is the lower limit for supporting the extended display in non-mirrored mode. In iPadOS 16.1 beta even lower resolutions were supported, but it looks like the monitor must now support at least Full HD (1920x1080). Otherwise there will only be the possibility for mirroring the iPad screen and the Arrangement menu will not be visible in iPadOS Settings. This is the case with all iPadOS versions from 16.1 to 18.2 (beta).
Secondly, even on monitors that do support Full HD or better resolution, iPadOS may still choose to only support mirroring with a strange resolution such as 1280x1024 even though 1920x1080 would be available.
I have tested with various iPad Pro 11" models from gen 1 to gen 4, various USB-C adapters, and cables. Extended display does work properly with certain monitors, but the above issues still exist on others.
I have filed feedbacks FB13576000 (Feb '24) and FB11467189 (Sep '22) on this bug. On the Support Community Forums there are a lot of users mentioning the same issues.