I am only able to see the edited version of screenshots I take if I take the same screenshot and edit it a second time. I played around with the settings in photos for a bit and realized that it was because I had selected ‘optimize iPad storage’ instead of ‘download and keep original’. I noticed many others were having this issue too. Try this, because it worked for me.
There appears to be a bug in iPadOS15/16 that impacts markup/cropping of screenshots and Photos.
A usable workaround is to first save the cropped and/or marked-up image - at which point, when reviewed, the markup appears to have been lost. Saving another screenshot/image will make edits made to the previously saved image visible.
It is also worth noting that if the screenshot is triggered with an Apple Pencil, using the corner-swipe gesture, the screenshot can be successfully saved without the need for a subsequent screenshot.
Anyone that is experiencing these issues are strongly encouraged to submit a bug report, to Apple, using Apple’s Product Feedback portal:
Every report submitted counts; until sufficient reports have been received, Apple may not assign resources for the issue(s) to be investigated and corrected.
When submitting a report, be sure to include details of both the iPad model and installed version of iPadOS in the body of the report; do not rely upon the associated pick-list, as this is rarely up to date.
Unable to save edited version of screenshot in photos
