Although i managed to fix the problem, I went back to test it and indeed it gave an error:

TypeError: lazy.ContextualIdentityService.getPublicIdentityFromId(...) is undefined3 TabsList.sys.mjs:323:40
_createRow resource:///modules/TabsList.sys.mjs:323
_populate resource:///modules/TabsList.sys.mjs:110
_populate resource:///modules/TabsList.sys.mjs:275
handleEvent resource:///modules/TabsList.sys.mjs:254
dispatchCustomEvent resource:///modules/PanelMultiView.sys.mjs:189
dispatchCustomEvent resource:///modules/PanelMultiView.sys.mjs:1484
_blockersPromise resource:///modules/PanelMultiView.sys.mjs:223

The fix is in the edit above.

I also can't reproduce with a new profile.

I literary copied my profile from %appdata% and pasted it in Windows Sandbox %appdata% for testing.

First i removed the chrome folder, could be the userChrome.css, nothing.
Second i removed all the extensions but the problem persisted, then i started closing tabs and at around 147 tabs closed it fixes it.
It crossed my mind it could be some extension that did something to a particular tab or something that breaks the list but it doesn't seem coming from a specific tab.

This only started a couple of days ago, probably when Firefox updated, not sure.
It also messed up a bit the userChrome.css where i had custom separators a bit where i fixed with the line "padding-block: 0px !important;".

I actually just fixed it, the problem came from tabs with a " --" at the end of the title, probably added from some addon. Please check the edit above for more info.