I confirm your observations. It appears that Other Options opens up the old right-click menu from Windows 10.
I can see that I am going to have to update
How to Open the Normal Template in Any Desktop Version of Word (except Mac 2008) although the primary vba method pointed out there works fine in Windows 11.
I do not know that this is a bug, but it certainly is a change. I've posted discussions in the Microsoft
Windows 11 and
Word forums about this. I am sending feedback using the feedback mechanisms because I do not think it is a good change.