When this mod is installed (1.21) fabric server all drowned are drowning and zombies cannot be converted, also turtles drown too.

[18:39:52] [main/INFO]: Found new data pack easy_npc, loading it automatically
[18:39:53] [Worker-Main-1/INFO]: 🗣 Register Easy NPC /easy_npc commands for Easy NPC ...
[18:39:53] [Worker-Main-1/ERROR]: Couldn't load tag minecraft:undead as it is missing following references: #easy_npc:skeletons (from easy_npc), #easy_npc:zombies (from easy_npc)
[18:39:53] [Worker-Main-1/ERROR]: Couldn't load tag minecraft:inverted_healing_and_harm as it is missing following references: #minecraft:undead (from vanilla)
[18:39:53] [Worker-Main-1/ERROR]: Couldn't load tag minecraft:sensitive_to_smite as it is missing following references: #minecraft:undead (from vanilla)
[18:39:53] [Worker-Main-1/ERROR]: Couldn't load tag minecraft:can_breathe_under_water as it is missing following references: #minecraft:undead (from vanilla)
[18:39:53] [Worker-Main-1/ERROR]: Couldn't load tag minecraft:wither_friends as it is missing following references: #minecraft:undead (from vanilla)
[18:39:53] [Worker-Main-1/ERROR]: Couldn't load tag minecraft:ignores_poison_and_regen as it is missing following references: #minecraft:undead (from vanilla)

Thank you for the detailed information; it made reproducing the issue straightforward.
Typically, a broken tag with "replace": false shouldn't override the original tag definitions. :/

I'm currently testing a fix, and once it’s validated across all mod loaders, I'll release the update for versions 1.21 and 1.21.1.

First tests looks fine:

The issue has been resolved, the patch has been submitted, and the updated version should go live within the next few minutes.

ive also tested this in solo and its doing the same, tested on my test server - results are
Just fabric API and the mod installed, entitles drowning in water that shouldnt, remove the mod and just run fabric API, mobs survive in water and zombies convert. - tested in both solo and test server

legend