PS5 Offline - P2 character does not save

Summary: PS5 Offline couch coop deletes character created under player 2 login. And if player 2 uses a character under player 1 account, it resets player 2 progress and removes all items from inventory as if they never played. Cloud sync is activated. Microsoft logged in.

Details of Attempt 1: Player 1 opens game, selects 1 offline hero. Player 2 activates controller, logs into their PS account, but no offline heroes were available from prior play. Only player 1 hero saved. Player 2 hero vanished. Use Minecraft dungeons menu to Save and Exit game. Close game in ps5 console.

Details of Attempt 2: Player 1 opens game and last played hero appears on screen. Player 1 creates new offline hero, so there are 2 offline heroes. Player 1 selects original hero and Player 2 selects newly created level 1 hero. Play game until player 2 reaches level 2. Save game and exit from Minecraft Dungeons 2 menu. Close game app on console. Re-open game, player 2 hero is back to level 1 and all items gone.