I have no hands-on experience using only passwordless yet, but just a thought;
- Are all Authorization Methods in MS Entra available and enabled for users which you suppose to be using? I noticed, that this selection affects also on Autopilot first login, what methods are displayed there.
- Can you create traditional Autopilot User Driven (not Autopilot Device Preparation) and compare your experience to it. Thing is, that in reality, Autopilot Device Preparation is not yet completely ready.