Have you explicitly tried pinging any block hosts? I had an issue where the provider was doing something with my data connection that bypassed the host file. But it worked on WiFi. Check with a ping in your shell. It may be an OS OR a provider issue.sorry for hijacking your answer.
i got the same magisk version installed, and for me adaway is not blocking anymore.
i am oos13
set up pixel 7a for my girl as well, with rooted stock OS ... ads will appear also on her phone.
so i guess its not a OS related issue.
you are on 26104 or 26105 magisk ?