I am also having this issue with my kids. I am hosting a BDS on my PC, while they play split screen on the Nintendo Switch. We've had this world for a couple of weeks now, and had no issue until the other day when one of my daughters tried to join after the 1.19.63 update. The Switch updated automatically without issue. I had been playing for a few hours when it went live, and she could not join the game until I saved, exited, and updated. The update did not apply to my account automatically in spite of reloading the launcher and switching to my Java worlds several times - I had to go to the Microsoft Store and force the update manually. After updating, the Switch started giving us errors messages saying that both of my kids had been signed out of their Microsoft accounts (which wasn't true), that their console data didn't match the cloud data, and that there were errors in their save files. I went to the home screen on the Switch and force-uploaded their console data to the cloud, after which point everything seemed fine that session. However, every time they've tried to join our BDS game since then, it's overwhelmingly loaded them in as new characters. It is also (rarely) loading them into their own Switch-saved single-player games (in both survival and creative) as new characters. Most of the time they load in correctly, but probably one out of every 10 loads is as a fresh character. On the flip side, every once in a while, it will connect them to our BDS as their actual characters, but there is no discernible pattern as to when or why it finds those characters instead of loading them to the new ones that appear to have been created after the update - it's almost always loading them into the BDS server as a fresh character.
It is not always loading them in to brand new characters every single attempt. They've moved those characters around while we tried to troubleshoot this, and they reload into those new characters most of the time now, not another brand new character at every join. Every once in a while though, it will generate another brand new character at the spawn point for them. I'm not tech savvy enough to understand how to pull Bedrock files out of my PC but am happy to share mine if someone explains how to, and it might help.
Empy3
I am also having this issue with my kids. I am hosting a BDS on my PC, while they play split screen on the Nintendo Switch. We've had this world for a couple of weeks now, and had no issue until the other day when one of my daughters tried to join after the 1.19.63 update. The Switch updated automatically without issue. I had been playing for a few hours when it went live, and she could not join the game until I saved, exited, and updated. The update did not apply to my account automatically in spite of reloading the launcher and switching to my Java worlds several times - I had to go to the Microsoft Store and force the update manually. After updating, the Switch started giving us errors messages saying that both of my kids had been signed out of their Microsoft accounts (which wasn't true), that their console data didn't match the cloud data, and that there were errors in their save files. I went to the home screen on the Switch and force-uploaded their console data to the cloud, after which point everything seemed fine that session. However, every time they've tried to join our BDS game since then, it's overwhelmingly loaded them in as new characters. It is also (rarely) loading them into their own Switch-saved single-player games (in both survival and creative) as new characters. Most of the time they load in correctly, but probably one out of every 10 loads is as a fresh character. On the flip side, every once in a while, it will connect them to our BDS as their actual characters, but there is no discernible pattern as to when or why it finds those characters instead of loading them to the new ones that appear to have been created after the update - it's almost always loading them into the BDS server as a fresh character.
It is not always loading them in to brand new characters every single attempt. They've moved those characters around while we tried to troubleshoot this, and they reload into those new characters most of the time now, not another brand new character at every join. Every once in a while though, it will generate another brand new character at the spawn point for them. I'm not tech savvy enough to understand how to pull Bedrock files out of my PC but am happy to share mine if someone explains how to, and it might help.