Photoshop 27.4 is the last version that handles sRGB color profiles correctly when system-wide HDR rendering is enabled in Windows 11

I don’t have an HDR monitor to test, but one thing needs to be pointed out if disabling the GPU corrects it.

Display color management, the actual conversion of the data from the document profile into the display profile, is nowadays executed by the GPU and driver. Disabling the GPU switches the whole operation back to the old standard pipeline using the CPU.

This means it can be difficult to determine if a problem is a faulty monitor profile or a GPU/system bug. One can affect the other. A marginally off-spec profile can cause the GPU to choke while it still works in the CPU. A profile that used to work may cause problems if the environment changes slightly. Display profiles are more complex than you’d think.

This is a chain, and every link in the chain needs to be on spec to work correctly.

Obviously, HDR complicates things considerably. The point is that you need to test all the links in the chain, and empirically, most color management problems have always been caused by bad display profiles. That’s always the prime suspect.

Not saying there isn’t a bug in Photoshop, just pointing to the baseline. Since this is posted as a bug report, others with similar problems should hopefully chime in.

EDIT - there might be a related problem on Mac, so that would indeed suggest a Photoshop 27.8 issue:

https://community.adobe.com/questions-712/very-bad-banding-since-the-latest-update-1629850?tid=1629850&postid=7694982#post7694982