I can’t believe that we are still trying to solve this. One would think that after so many years (I’ve started doing web almost 20 years ago) we would end up with some solutions baked in browsers

I think the issue is not the "solving", rather that people have different opinions and they want different things, and there isn't common agreement what is needed or how. Most editors work just fine for the basic needs. But well, that is my opinion.

Something like showcontrols for contenteditable with flags for features