My understanding is IMAP server (dovcot) returning some kind of message which Mail app returning as POSIX 96. in my case i have iRedMail setup which uses dovecot to provide IMAP and that dovecot having the facility to record the each login time to mysql database. In that i had issue in that table mysql not able to update lastlogin details. the error is return to IMAP client (Mail app) and Mail app showing that as error. usually all other IMAP client apps will ignore this type of IMAP protocol replies and continue to do service. But iOS18 Mail app stopping at these type of un-handled error messages in IMAP communication.
So my guess is, 1) Your dovecot server also having such issue and returning un-supported/un-handled error reply to IMAP client. if you are running your dovecot in debug mode, you can find the issue and fix it. Then your iOS18 Mail app will work.
2) Apple also can improve the IMAP protocol handling in their upcoming Mail app releases like if such type of ignorable error coming from IMAP server, simply ignore it by showing warning or do no action and do the mail fetch and do the essential operation.
I have plan to reproduce this error in my server maintenance time. if i am able to reproduce it, i will update about the specific protocol error that may help apple/others to fix the issue.