Apple Watch Not Unlocking Secured Notes

I can see this has been raised a lot this year and the solution appears to always be 'contact support'. There is clearly a problem as many people have clicked the 'I have this question too' on each post.

The issue is simple. Apple Watch is working to unlock the Mac and for unlocking other apps e.g. for me 1Password. However Notes that have been secured with a password are no longer unlocking. Used it be able to click on the note and watch would request the double tap to unlock it but now you have to enter a password. It is incredibly annoying.

I expect this a software issue and likely a bug in BigSur. I can confirm all my devices are on the latest software - no updates pending, and as above unlocking with Watch works everywhere else it is supposed to - it is only with Notes that it doesn't and there's no settings or information online anywhere on how to fix it. I refuse to spend time on the phone with support who from my experience tend to not really know the answer to something - they'll step through all the basic checks to get to the same conclusion that something is broken.