The bug
In 21w13a, going under y=0 removes the gradient effect from the fog and leaves only 100% or 0% fog.
This also affects the nether.
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Can confirm in 21w14a. Especially obvious when the dragon is alive.
Can confirm in 21w15a.

Cannot reproduce on 1.17.1 rc1.

Can still reproduce it in 1.17.1, but it's around y=-33 now.

Cannot reproduce anymore

fixed in 21w37a

Can still reproduce in 21w42a.

@unknown
You are mistaking a WAI behavior for this bug
In 21w13a the end for would loose it gradient when under Y0 no matter if the dragon was dead or alive,this no longer occurs
What you're seeing now is when you get too far from the island while the dragon is still alive you loose the dense fog effect but the fog still behaves as intended

Can't reproduce either, you might be refering to the void fog not appearing or the abrupt ender dragon fog, which are different issues.
Can confirm. However for me this issue already appeared at y=21.