For fun I made a python script below which should convert .AAE files' adjustmentData base64 section to a more readable .plist format. I hope it comes through intact.
One thing different in the Hipstamatic-generated "MCSN8042.AAE" in the original post [iCloud link to the sample files seems to be deleted by now] above that prevents Photos.app from importing images is that its decoded base64 portion is already .plist format while the base64 in iOS/iPadOS .AAE files needs further zlib decompression.
If an image or movie is edited in iOS/iPadOS, and AirDropped with Options > All Photos Data, then the Mac receives original IMG_0001.HEIC, edited IMG_E0001.heic and IMG_0001.AAE sidecar describing the edits which Photos.app can continue or revert to the original.
I have not yet much compared how the .plist values correspond to the imported Photos.app edits. I have not tried to reverse engineer this and write .AAE from scratch and try what might trigger the Photos import flaw if some type of .AAE is present. I have always deleted .AAE files, if they are present anyway.
macOS Monterey and later no longer has python pre-installed so you must install it by some method (MacPorts, Homebrew, by typing "python3" in the Terminal and then installing Command Line tools when prompted, download from www.python.org, etc).
You can then run the script via the Terminal (or maybe via IDLE.app etc) by putting it in the same folder as .AAE files, cd to that folder and type "python AAE_to_plist.py" without quotes (or depending how you installed python maybe "python3 AAE_to_plist.py"), then type the filename like "IMG_0796.AAE" when prompted to do so.
I am a python newbie so please let me know if the script needs fixes (my two youngest are having python course in high school math so I try to have some knowledge about it).
AAE_to_plist.py script to convert .AAE files to more readable .plist files:
1. Prompts for input .AAE filename.
2. Selects base64 data inside .AAE file's <data></data> and deletes whitespace tabs and linebreaks from it.
3. Decodes base64 to binary (some non-Apple .AAE might have .plist data already in this step making the script to fallback to only this base64 decode).
4. Decompresses binary to .plist.
5. Convert .plist to a more readable xml1 .plist format with the input base name. This step uses macOS /usr/bin/plutil so it does not work in Windows.