Apple Watch Ultra ambient light sensor???

It's interesting I have the same watches and noticed that as well. I submitted a request to allow end-users to be able to adjust the brightness even further in low light level situations as it's difficult to see. I've also added a privacy screen on my ultra since it's bright in well-lit situations and don't want folks snooping over my wrist and that's dimmed it a bit more.

Feedback - Watch - Apple

There should be a way to override the auto-dimming sensor. My brand new AWU is illegible in low light conditions unless I shine my phone’s flashlight at it for a few seconds.

seems counter-intuitive.

I have an Apple Watch series 3 that I upgraded from and it is brighter.

I’ve turned “always on” off as I read that might turn off the ambient dimming. That didn’t do anything. The watch is still dimming in low light conditions. This seems to be a battery saving exercise, however, it’s crippling the usage of the watch at night.

Yes it does;

"Unlike the ambient light sensors on smartphones,the sensor for the Watch is likely one of Apple's solar cell ambient light sensors, and "this allows for the sensor to be behind the display panel, as opposed to the traditional surface-mounted design seen on the majority of smartphones and tablets.

You can also quickly mute an incoming call by pressing the palm of your hand on the watch display and holding it there for three seconds. You must first turn on the option in the Apple Watch app on iPhone. Tap My Watch, tap Sounds & Haptics, then turn on Cover to Mute.

This is the ambient light sensor kicking in,this adjusts your screen brightness to match the surrounding area,there is no setting or configuration for this.