I found if no external display, this issue could be fixed by checking "update the session resolution on resize" option, but if there are external displays, this option is disabled, there is no way to fix this issue.
This is also present on non-notch macOS with menu bar present in full screen. It's like Remote Desktop expects the height of the display to be the height of the screen, and not the height of the available window frame ( screen height minus menu bar height ). This is with "update session resolution on resize" enabled.
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