Thank you for you help on this, after spending all day yesterday and today on this, I figured it out.
My unraid server on my network was misconfigured and it was trying to add a device with the same ip address as the pihole, i finally noticed my opensense logs were spammed with the mac address of the pihole changing back and forth. Once I reconfigured my unraid docker network correctly, everything fixed itself.
I am however not running unbound because honestly I do not see much benefit since I am already using pihole.
But everything is running super smooth now. Also Hostnames are populating in pihole from dnsmasq as expected, however I did have to turn off all Advanced DNS settings options and then it started working as expected.