Hooray! I can finally remove export MOZ_ENABLE_WAYLAND=1 from my ~/.bashrc file!
Firefox 121.0, See All New Features, Updates and Fixes
On Linux, Firefox now defaults to the Wayland compositor when available instead of XWayland. This brings support for touchpad & touchscreen gestures, swipe-to-nav, per-monitor DPI settings, better graphics performance, and more.
Edit: I also removed export MOZ_DBUS_REMOTE=1, which had been required to open links from external applications in Firefox on Wayland, from the ~.bashrc file. Logged out & back in - links opened okay from a couple of apps, so I will assume that line in the file is no longer required.