There are only a few adapters that support the 2.1 features (hdr+vrr+high resolution+high refresh rate, no lossy DSC). I even had to flash custom firmware for most of those features to work (vrr still doesnt)

They are not equivalent.

Conversion is a very intricate spec fulfilment over an incredibly high bandwidth signal.

I did the dive; The adapters are not sufficient.

They have limitations, specially when driven to the limits of the specifications.

When doing 4k@120fps 4:4:4 chroma you might have to deal with longer handshakes and sometimes even no handshake at all. Or random dropouts. Or HDR not activating properly.

But wouldn't this break the HDCP chain and therefore render many use-cases (playback of DRM-protected streams) broken?

For HDMI 2.0. For HDMI 2.1 and 4K/120hz you're looking at north of $25 and don't get VRR support.