It seems I have solved my problem.
I found this article on reddit: https://www.reddit.com/r/HomeKit/comments/i16zao/could_not_accept_invitation/
and the answer of hamiltsd is what I was looking for.
This is what is answered in this article and is the solution that worked for me:
download and launch the HomeKit reset profile Safari on both mobile devices (looks like they change the link periodically, so be advised link may be dated): http://appldnld.apple.com/iOSProfiles/HomeKitReset.mobileconfig (note: you can try first on just the one device and avoid full reset, but I was forced to do both devices)
install the profile on both devices then go to settings to install the profile per these instructions: Install a configuration profile on your iPhone or iPad - Apple Support
restart both devices (may be optional, but doesn’t hurt)
go to settings and scroll down. You should now see a “Home” icon to open then select to “Reset Configuration.” WARNING: this wipes out all your HomeKit accessories and settings. You will need to start over.
open HomeKit app on both devices. They said to leave app open for 10 minutes, but mine reset in a minute. This should force reset your configuration keys.
to test, I added a single HomePod mini to a new Home and then invited spouse. She accepted easy breezy.
And there it is. This solved all my troubles and now I'm able to invite my wife and share all devices on homekit.
Hope this is helpful for all the people still experiencing this problem after all these years of homekit. Wish apple would have this option always available to help us solve these frustrating problems..
To ease finding this solution on this forum i'll include some keywords: homekit sharing shared not possible icloud frozen account itunes could not accept invitation.