Using Windows 10 here (although I can confirm this error also exists for Mac users).
Unfortunately, this workaround didn't work for me. This issue is totally unbelievable and has cost us designers a lot of time wasted, really disappointing how SQSP is handling this
Yeah, the issue only started for me after the UI update too. ...and I agree with everyone saying Squarespace's response to this has been very disheartening. The only thing I can suggest is my solution above in the meantime, which is: to go to the site on your phone, force desktop mode, and then upload the font from your phone. It works for me and I am on a Samsung Android device. I have no idea whether it will work on other phones though.