Justin Nevius
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Came on here to report this exact same thing. Have lost MONTHS worth of work with this latest update MCPE-58640 that supposedly fixed split screen characters from showing up as default skins. Fix one thing, introduce a dozen other problems.
I'd rather keep the default skin and still keep my inventory than have to redo it all.
I'll hop on the train here as well. Same thing here - since the March 9th update, I've seen it on two different worlds now: Xbox Series X, local split screen - one where my son's account is host (on creative, so not a big problem there), and the other where my wife's account is host (on survival). Both cases I joined and had 0 levels and blank inventory. The survival in particular involved losing ~28 levels (had just enchanted a new pickaxe), and given we're building our own town in the mountains, multiple stacks of dark oak logs, light-gray stained glass panes, 3 enchanted pickaxes (one silk touch, one fortune/unbreaking/efficiency), and at least 3 stacks of iron lanterns amongst other items.
Previously (before this update) if I ever joined in and didn't see my items, it was due to my data not being refreshed to the game instance, so we would force quit the game and re-establish our connection - that would restore my items and levels.Tried that same method to no avail yesterday multiple times. This feels like the cache has been completely reset on worlds that formerly had split screen players.