Func app throws Encountered an error (BadGateway) from host runtime upon migration from .net6 in-proc to .net8 isolated model

[twisha]

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[twisha]

Upon deploying (using GHA) our updated azure func app, we get following error
Encountered an error (BadGateway) from host runtime.

NOTE: Works as expected on local

We've updated our FUNCTIONS_WORKER_RUNTIME from dotnet -> dotnet-isolated
AND updated our linuxFxVersion from DOTNET|6.0 -> DOTNET-ISOLATED|8.0
using az cli
Here are the commands

az functionapp config appsettings set --name dev-vert-conference-svc --resource-group dev-azfunctions --settings FUNCTIONS_WORKER_RUNTIME="dotnet-isolated"
az functionapp config set --name dev-vert-conference-svc --resource-group dev-azfunctions --linux-fx-version '"DOTNET-ISOLATED|8.0"'

NOTE: There is NO change in our function version. We are on ~4. { "name": "FUNCTIONS_EXTENSION_VERSION", "slotSetting": false, "value": "~4" },

[twisha]

We tried creating a new func app. Its the same behavior/error i.e. Encountered an error (BadGateway) from host runtime.