Multiple Finder issues after macOS Tahoe 26.1 — drag & drop, right-click options, and new window/tab missing

Since updating to macOS Tahoe 26.1, I am experiencing several severe Finder issues that are disrupting my workflow:

1. When I right-click a file on my Desktop (e.g. to move or save it into another folder), I now only see three options: “Get Info”, “Quick Look” and “Copy”. Before the update, I had many more context menu options. As a result, I can no longer move or organise files from the Desktop through right-click actions.
2. I can no longer open two separate Finder windows. The option “Open in New Tab” or “Open in New Window” is missing. The only option I get is “Go to Folder”, which is extremely limiting.
3. Drag & drop is also broken. For example, when I drag a screenshot from my Desktop into a folder, the file doesn’t drop, “bounces back”, or Finder ignores the action entirely.
4. When I'm in a folder and I want to copy a subfolder, I can't paste it into another folder.

Before the Tahoe update, this worked flawlessly.

These issues make it extremely difficult to manage files and perform basic daily tasks.

This is an awful update.

Are there anyone out there who has experienced something similar and found a solution?

These are just a few examples of how this update has already cost me an incredible amount of time, after a series of other problems (e.g., issues with my Wacom tablet, etc.). I can only hope a new update comes out soon, because this is very bad publicity for Apple!