So, here's something interesting I've observed:
In the Pi-hole Settings --> DNS --> Interface listening behavior, when I change that to "Listen on all interfaces" it immediately triggers the "DNS Timeout" for some devices.
FWIW, I have my Pi-hole configured to only listen on the eth0 port. As such, I do not get these DNS Timeout errors for any of my devices, regardless of which VLAN that are on.
If you temporarily disable your FW rules for the IoT VLAN, and then, create a "test" LAN IN FW rule to allow All traffic from the IoT VLAN to the LAN that the Pi-hole is on, do you still see these errors? If not, then there may be something amiss with the rule that is just forwarding DNS requests from the IoT VLAN.
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