This does not work for me even in WordPress 6.5.5 if I use the current default theme and have not activated a plugin. I can also recreate it in the Playground without any problems (i.e. the HTML doesn’t work).
Which theme are you using?
It looks like this changed last year in this PR: https://github.com/WordPress/gutenberg/commit/86d527ce4f71b33e6637104046e07258b8e410de
The addition of the excerpt length check means that the excerpt is run through wp_trim_words(). And it seems that an excerpt length is now always set. Do you mind filing a bug report here? https://github.com/WordPress/gutenberg/issues/new/choose
This is definitely a bug and change of previous behavior.
Looking at the code, the issue would have been introduced in WordPress 6.3, released in August 2023.
After testing 6.2 and 6.3 I can confirm this was introduced in 6.3 and I’ve created an issue https://github.com/WordPress/gutenberg/issues/66195
We mark posts that have trac/github tickets as resolved for sanity. It lets mods and volunteers know we don’t have to jump in and find an issue. You should follow the discussion to get updates.
For trac, you can click the ‘Watch’ button on the trac ticket (it’s near the bottom) to get email alerts. If you need to log in, it’s the same ID/password as you use for the forums.
For github, it handles that for you automatically
