After updating to Firefox v 99.0, compact mode no longer works, verified in new profile, see screenshot:

OS: Windows 10 Pro, version 20H2, build 19042.1586
Browser settings:
Toolbar density="compact(not supported)", font=Times New Roman 16, zoom = 120%
Possibly relevant config settings that are listed as different from default;
browser.compactmode.show=TRUE, browser.proton.toolbar.version=3, browser.tabs.inTitlebar=0, browser.uidensity=1, devtools.toolsidebar-height.inspector=350, devtools.toolsidebar-width.inspector=700, devtools.toolsidebar-height.inspector.splitsidebar=350, toolkit.legacyUserProfileCustomizations.stylesheets=TRUE,
addons:
Addblock Plus, UBlock Origin, Classic Youtube Design, SponsorBlock, Old Reddit Redirect
Edit:
The issue seems to be solved by removing
@media (-moz-os-version: windows-win10) {
from line 95, and the closing } from line 100