Monterey - create new user & group with IDs 1000

I think the login window only allows logins with UID in range 500-999.

The lower number is well documented.

The upper number is from memory although secondary references include https://www.cnet.com/tech/computing/how-to-hide-user-accounts-from-the-log-in-window-in-os-x/ (This can be read as only the user 1000 but 1001 is OK) and a comment to https://apple.stackexchange.com/a/118990/237

This reddit comment suggests UID >= 1000 are for users managed by network directory services etc

UIDs of 1000 and greater are generally reserved for Network/Mobile accounts. Like Open Directory, Active Directory and Open LDAP, etc.