I had a strikingly similar experience. A little over 2 years ago I had my iPhone low on storage. It was under 6 months old and had precious pics/vids of my late pregnancy, newborn daughter, and her brothers. Our family memories gone. It was during 2020 lockdown. We talked to so many people as we were devastated with little we could do. Apple and Verizon were no help, to say the least. We were told by many tech companies that we also would not be able to get through the encryption. We could have sent it away to try, but I was too concerned. I haven’t tried it in quite sometime. I’m thinking of bringing it into Apple and giving it another go. I am confident there was a storage issue with that iPhone version. I’ve heard this similar story too many times. I’ve had several new iPhones now. Don’t ever let your phone get full on storage or even close to it. iCloud also fails. Don’t trust anything. Try to use other cameras more than your phone. Set a manual back up date to your computer and stick to it on a schedule.
I did let this slip up end of last year and something similar happened. We brought the phone to Apple. I was worried it was 2020 all over again, but this time there was no lockdown and we could go try to get help. They were able to update and save my photos! It gave me hope and I hope it gives you hope as well. I was not able to do that with the phone I got toward the end of 2019. Whatever newest version that was at the time, we were not able to update it when it shut down in spring 2020. I’d say if you have a newer version than that (I’m sorry I don’t remember!) than hopefully you can get your photos back and update. Keep up with the updates too! We were told too many annoying times how that plays a part.
Take care and wish you the best of luck!