I'm reading this right now on pixel with latest play services update and have no problems using the phone. I'm not saying no one is having problems, but I wonder what the statistics are.
This is for the Google play system updates. Not the Play services app.
You can check your version in settings, security and privacy, Google play system updates. It should say November 2023 as the latest. Those on January recived the bad update.
I have the January update and no problems. It must be a driver bug that an app is leaving in a bad state. I don't have any apps that access the camera other than the official Google camera app.
Do you have a work profile or multiple user profiles set up on your device?
This is similar to another issues they had a couple months ago, where my phone would fail to boot even into recovery to try to factory reset it.