TextEdit freezes on opening files via "open" menu (Monterey on MBP 16" 2019)

Solution 1:

The answer below has no effect.

I tried on an Intel Mac running Monterey 12.0.1 and easily reproduced the bug.

On M1 Mac, still on Monterey 12.0.1 there are no bugs of this type, TextEdit works perfectly.

You can try this :
1) you close Textedit
2) you open the Finder, click inside to get focus, then you do cmd+shift+g 
3) in the "Go to directory" Windows, you paste ~/Library/Containers
4) here you find com.apple.TextEdit and you drag it to the Desktop (with cmd key pushed).
5) you reboot your Mac and retry.