I was experiencing the same issues - post Win11 Upgrade on my SP7 touchscreen and facial recognition didn't work.
I tried all the steps above and also downloaded drivers and things are working now.
Steps:
- Surface Diagnostics (seemed useless here tbh)
- System File Checker - No issues found but maybe that helped?
- Facial recognition - removed existing face registration and added again.
- Removed "HID Compliant touch screen" there was only one but I removed it anyway
- Installed Surface Pro 7 Drivers for Win11 from here:
https://www.microsoft.com/en-us/download/details.aspx?id=100419
- Reboot
Everything seems to be working as it used to now.
Thanks!