I have had two physical drives formatted in Mac OS Extended (HFS+). Both of those have two partitions: one TimeMachine partition and one partition for files (not TM). They work fine. TM backs up to both of those two partitions that are located on two different drives.
I got a new drive (a third physical drive) and since I am now on Big Sur, I decided to try APFS and store Time Machine on one partition and misc files on the other partition.
At first, I created one 'container' and created two APFS System Volumes (sorry if the terminology is not exactly correct). When I went into Time Machine, I could not find the Volume I wanted to use for TM backup, nor any volume from that drive.
On reading some comments, I figured I might need a partition of a defined size (rather than the APFS volume which can change size. I think?). So I partitioned the hard drive into two APFS 'containers' of a fixed size, each one half the size of the drive. The Time Machine is on the second 'container' since the first container has files I had already backed up to this drive.
Now, suddenly, TM recognizes the second partition. It did not do so earlier today. Go figure.
So I am good to go!