Verifying according to the instructions - Before the update I got this as expected:

root@Jdnsmasq:~# dig A netflix.com @127.0.0.1
;; communications error to 127.0.0.1#53: timed out
;; communications error to 127.0.0.1#53: connection refused
;; communications error to 127.0.0.1#53: connection refused

; <<>> DiG 9.18.18-0ubuntu0.22.04.1-Ubuntu <<>> A netflix.com @127.0.0.1
;; global options: +cmd
;; no servers could be reached


Jan 02 11:13:01 Jdnsmasq systemd[1]: dnsmasq.service: Main process exited, code=dumped, status=11/SEGV
Jan 02 11:13:01 Jdnsmasq systemd[1]: dnsmasq.service: Failed with result 'core-dump'.


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Upgrade

...
Preparing to unpack .../12-dnsmasq-base_2.86-1.1ubuntu0.4_amd64.deb ...
Unpacking dnsmasq-base (2.86-1.1ubuntu0.4) over (2.86-1.1ubuntu0.3) ...
Preparing to unpack .../13-dnsmasq_2.86-1.1ubuntu0.4_all.deb ...
Unpacking dnsmasq (2.86-1.1ubuntu0.4) over (2.86-1.1ubuntu0.3) ...
...
worked without issues


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root@Jdnsmasq:~# systemctl status dnsmasq
● dnsmasq.service - dnsmasq - A lightweight DHCP and caching DNS server
     Loaded: loaded (/lib/systemd/system/dnsmasq.service; enabled; vendor preset: enabled)
     Active: active (running) since Tue 2024-01-02 11:18:03 UTC; 3s ago
    Process: 4327 ExecStartPre=/etc/init.d/dnsmasq checkconfig (code=exited, status=0/SUCCESS)
    Process: 4335 ExecStart=/etc/init.d/dnsmasq systemd-exec (code=exited, status=0/SUCCESS)
    Process: 4344 ExecStartPost=/etc/init.d/dnsmasq systemd-start-resolvconf (code=exited, status=0/SUCCESS)
   Main PID: 4343 (dnsmasq)
      Tasks: 1 (limit: 38247)
     Memory: 588.0K
        CPU: 45ms
     CGroup: /system.slice/dnsmasq.service
             └─4343 /usr/sbin/dnsmasq -x /run/dnsmasq/dnsmasq.pid -u dnsmasq -7 /etc/dnsmasq.d,.dpkg-dist,.dpkg-old,.dpkg-new --local-service --trust-anchor=.,20326,8,2,e06d44b80b8f1d39a95c0b0d7c65d08458e880409bb>

Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: using standard nameservers for netflix.com
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: reading /etc/resolv.conf
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: using nameserver 8.8.8.8#53
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: ignoring nameserver 127.0.0.1 - local interface
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: using standard nameservers for example.com
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: using standard nameservers for nflxext.com
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: using standard nameservers for netflix.net
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: using standard nameservers for netflix.com
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: read /etc/hosts - 7 addresses
Jan 02 11:18:03 Jdnsmasq systemd[1]: Started dnsmasq - A lightweight DHCP and caching DNS server.


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Trying the issue trigger again:

root@Jdnsmasq:~# dig +short -tA ubuntu.com @127.0.0.1
185.125.190.29
185.125.190.20
185.125.190.21
root@Jdnsmasq:~# dig +short -tAAAA ubuntu.com @127.0.0.1
2620:2d:4000:1::27
2620:2d:4000:1::28
2620:2d:4000:1::26
root@Jdnsmasq:~# dig A netflix.com @127.0.0.1

; <<>> DiG 9.18.18-0ubuntu0.22.04.1-Ubuntu <<>> A netflix.com @127.0.0.1
;; global options: +cmd
;; Got answer:
;; ->>HEADER<<- opcode: QUERY, status: NOERROR, id: 63180
;; flags: qr rd ra; QUERY: 1, ANSWER: 3, AUTHORITY: 0, ADDITIONAL: 1

;; OPT PSEUDOSECTION:
; EDNS: version: 0, flags:; udp: 512
;; QUESTION SECTION:
;netflix.com.			IN	A

;; ANSWER SECTION:
netflix.com.		60	IN	A	18.200.8.190
netflix.com.		60	IN	A	54.155.246.232
netflix.com.		60	IN	A	54.73.148.110

;; Query time: 16 msec
;; SERVER: 127.0.0.1#53(127.0.0.1) (UDP)
;; WHEN: Tue Jan 02 11:18:36 UTC 2024
;; MSG SIZE  rcvd: 88

root@Jdnsmasq:~# dig A netflix.com @127.0.0.1

; <<>> DiG 9.18.18-0ubuntu0.22.04.1-Ubuntu <<>> A netflix.com @127.0.0.1
;; global options: +cmd
;; Got answer:
;; ->>HEADER<<- opcode: QUERY, status: NOERROR, id: 29034
;; flags: qr rd ra; QUERY: 1, ANSWER: 3, AUTHORITY: 0, ADDITIONAL: 1

;; OPT PSEUDOSECTION:
; EDNS: version: 0, flags:; udp: 1232
;; QUESTION SECTION:
;netflix.com.			IN	A

;; ANSWER SECTION:
netflix.com.		52	IN	A	54.73.148.110
netflix.com.		52	IN	A	54.155.246.232
netflix.com.		52	IN	A	18.200.8.190

;; Query time: 0 msec
;; SERVER: 127.0.0.1#53(127.0.0.1) (UDP)
;; WHEN: Tue Jan 02 11:18:44 UTC 2024
;; MSG SIZE  rcvd: 88


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working fine now, no segfault

log only has the start:
Jan 02 11:18:03 Jdnsmasq dnsmasq[4343]: compile time options: IPv6 GNU-getopt DBus no-UBus i18n IDN2 DHCP DHCPv6 no-Lua TFTP conntrack ipset auth cryptohash DNSSEC loop-detect inotify dumpfile

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Setting as verified