If multiple mobs are trying to generate a path to reach other mobs but fail each time, the TPS just starts dying immediately to the point the game is unplayable. I'm not at all experienced with coding but I'm thinking it's because the mobs will immediately try to generate another path after failing, with no delay in-between.
This could double as an exploit by trolls/griefers on a server, as an extremely simple and cheap lag machine. It may even happen completely on accident, by maybe there being a cluster of zombies stuck underneath a village.
I first found out about the bug by having an Iron Golem atop a surface that zombies cannot reach, thinking it was because they were on different Y-levels, but after a bit more testing by trapping a villager in a glass box surrounded by zombies, I found out that it didn't need to be different Y-levels.
If it's worth your time I recommend watching this example video.
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Very similar issue to MCPE-64344, MCPE-114206, and MCPE-120605; possibly the same cause.

This issue existed in Java Edition also and was fixed years ago. See https://bugs.mojang.com/browse/MC-17630?focusedCommentId=92590&page=com.atlassian.jira.plugin.system.issuetabpanels%3Acomment-tabpanel#comment-92590 for analysis.

While testing this bug, I found something very interesting and maybe useful to find the cause of the bug. I made a square boundary of two blocks tall and in the center made a piller of three blocks tall. I summoned dozens of husk inside the boundary and created an iron golem on the 3 blocks tall piller. To check TPS I used the same method used in the example video. The TPS was normal when there was boundary but when I removed some of the blocks from the boundary the TPS dropped immediately.
I am attaching a video showing this behavior.
[media]
anyone able to confirm this for 1.18.10? Tried the husk method mentioned above (with about 200 husks on win 10) didn't get any noticeable lag besides a small frame drop.

ive tested both setups listed here and i have found no noticeable TPS drops, measured both with server software and with snowballs. The problem probably lies with how powerful your device is, while lower end devices might struggle with this, other machines probably will not have a problem. Therefore, i truly wonder if this a bug or just poor device performance.

@Sierra, it has an ADO number, and is marked as confirmed, so it is definitely a bug, but maybe just one that isn't as noticeable on beefier machines.

MCPE-120605 (which is closed due to being tracked here) mentions lag induced by entities being redirected by slime blocks.
I'm seeing the slime block redirection aspect of this bug with a small (three ghasts) ghast blaster on my M1 iPad Pro.
The farm feeding my ghast blaster is a massive redstone contraption, but without the ghasts, there's essentially no lag. In fact, with two ghasts, the lag is barely noticeable, but as soon as I add a third or fourth ghast, the lag is horrendous.
Edit: Since I'm on iOS, the lag may be exacerbated by MCPE-66740, but overall, the lag is almost certainly due to the issue described in this ticket.

Affect 1.19.0.34

Affects 1.19.31 and 1.19.40; see MCPE-163845 for a thorough description of how this can be reproduced with allays.

It seems this bug can be triggered without player intervention by MCPE-41803. The video linked on MCPE-171681 shows pretty clearly that extreme lag occurs when a ghast targeting a player flies into a lava column.

Still a bug in 1.20.10.23

Still a bug in 1.20.1

1.20.1 Switch OLED, Game Card
Noticed a significant FPS drop whenever Villagers (especially Farmers) attempts/pathfinds to work.
Ever since the non full block parity with Java (Mud, Path Block, Farmland, etc.), Farmers have difficulty pathfinding to full grown crops (as well as trying to replant) & simply stares at their "target crop" until their work period is over, with the FPS returning to normal.

1.21.41
Annoying lag, too many ghasts, short character freezes while all the mobs attack you and extremely slow generation
It is absolutely normal not to solve this problem for 5 years and not even listen to us
The important thing is to remove the exclusives on bedrock 😞