Looks like KWin 6.3 removed pointer emulation for tablets (read blog here), it was for applications that haven’t implemented tablet input in wayland and was removed because it creates a few problems.
So apps like Chrome that haven’t implemented tablet input won’t be intractable with a tablet in wayland.
Possible temporary workarounds:
Running Chrome with KWIN_WAYLAND_EMULATE_TABLET=1
(maybe be removed in the future)
Or running Chrome with X11 instead of native wayland for now.
You probably have the native wayland ozone flag enabled.
For those who come across this, you can help bring this issue to Chromium developers attention and pressing the +1 button just like I did.
https://issues.chromium.org/issues/40282832