IPv6 is disabled.
grep local.home /var/log/pihole.log
Mar 20 11:16:32 dnsmasq[3608298]: query[A] sub.dev.local.home from 192.168.70.1
Mar 20 11:16:32 dnsmasq[3608298]: /etc/pihole/custom.list sub.dev.local.home is 192.168.70.10
Mar 20 11:16:32 dnsmasq[3608298]: query[AAAA] sub.dev.local.home from 192.168.70.1
Mar 20 11:16:32 dnsmasq[3608298]: forwarded sub.dev.local.home to 192.168.70.1
It seems A record seems to be resolved correctly which returns 192.168.70.10 but AAAA records are forwarded (back) to the router. And the router doesn't know what to do with it then times out.
That's how I read it with my limited knowledge.