Hi all, we've faced the same issue – our app was rejected because "Sign In with Apple does not sign in".
We use Auth0 webauth, so the authorization happens inside the in-app browser window on a page hosted by Auth0.
We couldn't reproduce this error with any of our team member's AppleIDs. We tried on several iOS versions on real devices and on a Simulator, we tried on a fresh Apple ID (never used to sign in to our app), on existing accounts (used previously to sign in to our app), and we tried to revoke our app authorization before sign in again. Everything works as it should.
Also, we have error monitoring (Sentry) set up, and the only error we see in logs is for the Apple reviewer. It is "invalid_grant (The code has already been used.)"
In the Auth0 logs there is only one such error as well.
I guess we will try to submit an appeal to the Apple Review team with all this information, as Sanvean kindly suggested in this thread.