This behavior is seen on my Garmin Forerunner 265S after updating the software to version 24.12. When I toggle the Touch setting to ON, it gets enabled for both General Use and During Sleep. When I toggle During Sleep to OFF and return to Settings, it gets disabled for both.
I have tried toggling the settings from the watch directly as well as from the Garmin Connect App (Android) while connected and synced to the watch, but the glitch remains the same. This had been working fine until software version 23.20.