Found the solution to the issue. Seems like the backend changed and the related components need a manual update in the code view section of the flow.
Solution:
- Select your Logic App
- Go to code view
- Add to the action path the following: /formrecognizer like this: "/formrecognizer/documentClassifiers/@{encodeURIComponent('XYZ')}:analyze"
Link to GitHub Issue Report: https://github.com/Azure/LogicAppsUX/issues/6155
Thanks to https://github.com/mvitoloaitana for the suggestion and help resolve the issue.