Hello,
Sorry for the trouble caused at your end.
Per the description shared, I understand the concern facing at your end and tested the behavior in the latest Word version 16.56, where I can reproduce a similar behavior at my end. However, when I test in the previous version 16.55, I can't reproduce the behavior. So, I request you submit the report on the behavior to the developing team via app feedback which is the best way to report it.
Reference: How do I give feedback on Microsoft Office?
If this behavior is causing a delay with your work, I request you download the 16.55 version of the Word app at your end and use the 16.55 to use the embed objects. Reference: Update history for Office for Mac - Office release notes | Microsoft Docs
In addition, we set the primary thread: MacOS: Microsoft Word not displaying pasted Microsoft Excel - Microsoft Community for the same behavior, where you can subscribe to this thread to get if there are any updates. To make it easier for others to identify the issue, we will close the thread from further posting.
Appreciate your patience and understanding, Have a good day and stay safe!!
Best Regards,
Chitrahaas