First of all - DH is the best mod so far, really, huge thanks to you. Second - wow, what was that verification system, that's genius!
And now about the problem. I've seen this bug on 1.21+ on more than 6 modpacks i've tried, and also on my own modpacks i've made. Everywhere was different mods, so i can't really understand what's the problem. As you can see on the screenshot, the visuals are broken. BUT, broken they are only on and under the level where you spawned. above 3 blocks of spawn position - everything is perfect