This issue has been a head-scratcher. I have however found a workaround which I'm not sure is the appropriate thing to do, but at least lets me develop my app without issue.
In my main.swift file I had code that would check for the existence of the Bundle.main.appStoreReceiptURL file, validate that the data was not empty, and if it was, exits the app with code 173 as described in the documentation here: https://developer.apple.com/documentation/appstorereceipts/validating_receipts_on_the_device?language=objc
This has worked in the past when using debug configurations, and lately only intermittently. Eventually I would get hard-stuck with the "your app is damaged" message and be unable to continue running my debug configuration.
Today I've modified my main.swift file to not perform this file check for debug configurations, and the app will load up just fine so I can continue working on it. I'm assuming this is safe to do since the receipt validation is still there for my release builds, but is confusing since this had worked in the past. Maybe Apple no longer supports this configuration and only validates release builds?
It'd be great to hear from someone with an actual answer to this question, and verify if I had just setup my debug configuration incorrectly or if there's something wrong with Apple's validation service. Either way, I thought I'd log my experiences here in case this helps any other frustrated developer out there.