I'm just chiming in that this just appeared for me as well. I did the most recent cumulative update and it completely broke the Windows Ink Workspace for me.
I could not be more disappointed with this turn of events and I wonder if this is just a bug caused by the update, but either way, Microsoft needs to know that this is EXTREMELY upsetting for many of use who use our Surface Pens in different ways for our daily work and depend on the functionality that is offered. Sketchpad is something I use multiple times a day on my Surface Go to take quick notes and then later import them into OneNote.
I also frequently use the Sticky Notes so this new "version" of the Windows Ink Workspace (can you even call it a workspace anymore?) is terrible.
This needs to be fixed ASAP.
Just know you're not alone in noticing this and wanting it to be back the old way, which was tons more functional and useful.