This is not unique to Windows 11.
It is related to the Microsoft disk management feature.
Extend volume is available when there is unallocated space immediately to the right of C:
When there is not free space extend volume appears grey in disk management.
The extend volume cannot be performed when grey in any Windows edition / version (11, 10, 8.1, 7, etc.)
""You can use Disk Management to add space to an existing volume, extending it into empty space on the drive, but only if the empty space doesn't have a volume on it (it's unallocated) and comes immediately after the volume you want to extend, with no other volumes in-between, as shown in the following image. The volume to extend also must be formatted with the NTFS or ReFS file systems.""
Since the recovery partition is right after C: and the allocated space if after it, the only option is to use a 3rd party Partition manager or Partition assistance to change the order of the partitions. Some of these apps, also provide a command line that can be invoked during Unattended XML.
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