I have this same issue. When using an Apple Macbook Pro/Air M1 and directly connecting the LG 34WK95U-W I am unable to use resolutions higher than 3008x1269. This is in contrast with the 2020 Macbook Pro 13" that I use that provides higher resolutions up to 3840x1620. The hardware is definitely not the issue here as the Macbook M1 range supports the total pixel output using the internal display and the Apple XDR Display. This configuration renders a total number of pixels of 7,056,000 + 20,358,144 = 27,414,144 total pixels. This is compared to the pixels rendered in the desired LG 5K2K resolution of HiDPI 3840x1620 (True Resolution: 7680x3240) of 24,883,200. So in terms of raw output, the hardware can do it, but there appear to be some issues with external displays in general. A non-exhaustive list of issues currently presenting on the M1 are: Intermittent resolution changes in screen wake. Intermittent misdetection of Monitor resulting in incorrect resolution options (No HiDPI) Prolonged black screen during wake and boot during monitor detection. Fewer "More space" options when selecting Scaled Resolutions on displays greater than 4K. Hope this adds detail to this issue.

Thanks for the update @LongTimeAppleGuy I, like you, completed the entire Apple Support process and upon completion, after many hours, like you, felt vindicated in my resolve when I was told Engineering is looking into it. That was three months ago. I have since which time lost my resolve and my communication with Apple Support. I, like you, continue to hope that Apple does address this significant issue, but I would not say I am hopeful.

Hey all, On the Macbook Pro M1 Max there are far more supported resolutions. I have both the Macbook M1 Air and Macbook Pro M1 Max and on the same configuration, there are many more options for scaling. It appears the issue was a limitation with M1 hardware that Apple failed to acknowledge.