The "solution" really does work 100% of the time , sadly I've never managed to work out what is at fault ,the TV, or the AV receiver. I am confident it is not the HDMI cables, I've tried cheap, I've tried expensive, its a placebo effect when you change them and it works for a bit but it will fail again. As does turning off features on your tv or factory resetting the TV. I'm about 90% sure its the TV which fails to negotiate or even transmit any data over the hdmi but I can't proof this and LG will always pass the book to someone else. I'd love it if I could intercept the full hdmi signal and break it down.
So in my case on my AV receiver I have all sorts plugged in, an xbox, switch, ps5, nvidia shield snes classic, wii. If I turn the Switch on, my AV receiver will auto turn to the Switch input and the TV auto changes to HDMI2 and then the little logo will pop up on the AV receiver to show its receiving an audio stream be it pcm, dts or dolby. I then will press the Netflix button (or Amazon or shortcut button to Disney+ etc) and my AV receiver will change from Switch to TV and the letter ARC will display on the receiver.
Like you mentioned sometimes, it works as if there is no fault, I will turn the TV on using the Netflix button, and ARC just works, some annoying times i'll turn the TV on with the netflix button, the TV turns on, Netflix loads then almost instantly it switches to HDMI2, and then the PS5 auto turns on ... !
I just think Arc, HDMI-CEC etc is just bugged believe, other control codes are being sent by devices in invalid formats its just not a great tech.
PS I prefer the Netflix app on the TV vs some version on on other streaming devices, mainly because of the supported audio formats, dolby vision and resolutions which aren't always fully supported when using a connected device. Also you then don't need an extra device switched on just to stream.