Microsoft keeps making it harder for consumers to set up Windows with just a local account. For the privacy conscious or other use cases, especially when using the Pro edition, it should be possible.
Build 22616.100 RSS
Microsoft has released Windows 11 build 22616.100 (KB5014650) to Insiders in the Dev and Beta Channels. It does not add anything new and is a cumulative update to test the servicing pipeline.