Can confirm, issue on xcode 12.5.1, ios 14.5 + big sur 11.5.1. Intel mac minis on same setup have no issue, all m1s unable to save image in simulators (or react at all to picked images).

Can also confirm that this is not an issue on Xcode 12.5.1 and iOS 14.1 and iOS 14.4 (didn't test interim versions), but is an issue on iOS 14.5