Namespace directory /var/lib/docker/user.group not created with --userns-remap="default"

[osorito]

Expected behavior

According to the official Docker documentation for Enable Userns Remap on the Daemon,
in step 5) "Verify that a namespaced directory exists within /var/lib/docker/ named with the UID and GID of the
namespaced user, owned by that UID and GID, and not group-or-world-readable".

Actual behavior
Docker with userns-remap enabled should create directories in /var/lib/docker with userns-remap.
Directory /var/lib/docker/165536.165536 not found

Steps to reproduce the behavior

Fresh install of Docker, os debian . Selected no to create portainer.

Confirm dockremap is created

Verified no containers or images in system

Configuration of override.conf

With userns-remap disabled docker service is active

Once enabled if fails

Logfile

Docker version

Docker info
root@docker:/etc/systemd/system/docker.service.d# docker info
Client: Docker Engine - Community
Version: 27.1.0
Context: default
Debug Mode: false
Plugins:
buildx: Docker Buildx (Docker Inc.)
Version: v0.16.1
Path: /usr/libexec/docker/cli-plugins/docker-buildx
compose: Docker Compose (Docker Inc.)
Version: v2.29.0
Path: /root/.docker/cli-plugins/docker-compose

Server:
Containers: 1
Running: 0
Paused: 0
Stopped: 1
Images: 0
Server Version: 27.1.0
Storage Driver: overlay2
Backing Filesystem: extfs
Supports d_type: true
Using metacopy: false
Native Overlay Diff: true
userxattr: true
Logging Driver: journald
Cgroup Driver: systemd
Cgroup Version: 2
Plugins:
Volume: local
Network: bridge host ipvlan macvlan null overlay
Log: awslogs fluentd gcplogs gelf journald json-file local splunk syslog
Swarm: inactive
Runtimes: io.containerd.runc.v2 runc
Default Runtime: runc
Init Binary: docker-init
containerd version: 2bf793ef6dc9a18e00cb12efb64355c2c9d5eb41
runc version: v1.1.13-0-g58aa920
init version: de40ad0
Security Options:
seccomp
Profile: builtin
cgroupns
Kernel Version: 6.8.4-2-pve
Operating System: Debian GNU/Linux 12 (bookworm)
OSType: linux
Architecture: x86_64
CPUs: 2
Total Memory: 4GiB
Name: docker
ID: 94d17bd9-12c8-417b-9090-2482c4aa2746
Docker Root Dir: /var/lib/docker
Debug Mode: false
Experimental: false
Insecure Registries:
127.0.0.0/8
Live Restore Enabled: false

root@docker:/etc/systemd/system/docker.service.d#

Additional information
Host