Mobs that can drop multiple items upon death are dropping their items in the exact same position with the same rotation, causing z-fighting. This was not an issue in previous versions, as before this preview mob drops would spread out upon death and would be be randomly rotated.
Step to Reproduce:
Spawn any mob that has multiple item drops (Such as a Zombified Piglin, which can naturally drop up to 4 different items)
Kill the mob (Looting III can help make it drop more than 1 item)
If it drops more than 1 type of item, then they will start z-fighting
Expected Result:
The items dropped by mobs spread out and randomly rotate to prevent z-fighting
Observed Result:
The items dropped by mobs are all in the exact same position and rotation, causing z-fighting
I had the same problem when a wolf killed a rabbit, the two rabbit hide did the same thing.