As I noticed that I had an issue on iOS as well, I found a reddit article about the issue with whereby on ios. Deleting it fixed it immediately. I then found the app burried on OSX Sequoia as well. Deleting it restored quicklook immediately. Pages & Numbers were fixed as well
Thank you!
So it turns out I had the issue on iOS too but had not appreciated it - whenever opening a .docx in Outlook I would get a message saying the file could not be opened (but that I could open it in the 365 app - which worked). I deleted the Whereby app and the problem has been solved. Re-installing Whereby causes the error to recur.
I have not been able to locate a Whereby app in MacOS yet but will keep looking.
EDIT: So very strangely the problem went away on my M2 Air after I opened an Office document with Pages. I made no other changes to my MacOS setup. Off to try this on my other machine.
EDIT: So this tactic did NOT work on my Intel i7 Mini (Pages refused to open the file) and Whereby had not been installed. However, thinking about whether there could be interference from another app I sequentially moved some apps I was not using very much - in my case it was some imaging apps from Celestron and Hue that are used to operate cameras that they make, as well as the Blue microphone app - into the bin. Initially nothing changed, but when I emptied the bin the problem went away. It seems one of these three apps was associated with the problem, but because all three were fully deleted at once I have no way of confirming which one without reinstalling them and seeing if the fault recurs; I will try this later.
EDIT: One other thing that seems to have changed is that .docx files are now considered "Microsoft Word document (.docx)" rather than "Microsoft Word (outline)" - which is what they were considered when the fault was present.
Thanks again
@sigalf !