Apple Pencil not working with Sidecar - MacBook Firewall was the issue
I was having a similar issue to what people were describing in another thread (Apple Pencil doesn’t work with Sidecar - Apple Community), and after troubleshooting myself, chatting with an Apple Support Advisor, then speaking with an Apple Support Advisor on the phone, it was my Firewall on my MacBook Air that was blocking my Apple Pencil Pro from being recognized. So, as another recommendation for those having issues with their Apple Pencil not working while using Sidecar, try disabling your Mac's Firewall.