"It's either a Mac Mini problem or a Big Sur problem."
No.
It's
your problem. You don't understand what's going on.
A 4k display has a native resolution of 3840x2160 regardless of the size of the display.
A 27" 4k display has the same number of pixels as does a 32" 4k display, or a 24" 4k display. A 4k tv set has the same number of pixels, whether it's 40" or 65".
The overal size of the display has NOTHING to with this. The pixel size "is what it is".
On a 27" 4k display, the pixel size is .1557mm.
To verify that for yourself, go this page:
It doesn't matter "what size" of display the Mac reports... the physical pixel size cannot be changed on the display. Again, it is what it is.
You fail to understand what the concept of "retina" means on the Mac.
A retina display has FOUR TIMES the number of pixels as what the display is intended to "look like".
Thus, a "4k" display, when used in retina mode (also called "HiDPI mode") on a Mac will use 4 pixels to display "the perception of a single pixel".
That's why you see "1080p" in the displays pref pane, etc.
When you display at 2560x1440, you are choosing a resolution that "looks like" 1440p.
If 1440p looks "good enough", use that.
But be aware that using a scaled (as distinguished from "pixel doubled") resolution can "eat up" processing power. This could cause the Mac to heat up, and the fans to run.
But a 27" 4k display, to run in true "pixel doubled" mode (looks like 1080p), is the way the Mac OS will run best. It will run well in full 4k, but again, the text will be too small to be readable (at normal font sizes).
There is a way to force the Mac to see the display "as a PC display" and perhaps not "as a tv". You can find out how to do that here: