I got a response on GitHub recently from one of the devs about a related question. It seems that email verification is broken right now, but should be fixed soon:
https://github.com/LemmyNet/lemmy-ui/issues/1062#issuecomment-1577135751
I think email verifications might be broken on
0.17.3
. They are fixed in the next release tho. Apologies for that.