Backport of Apply graph failure handling into v1.1

[teamterraform]

Backport

This PR is auto-generated from #30199 to be assessed for backporting due to the inclusion of the label 1.1-backport.

WARNING automatic cherry-pick of commits failed. Commits will require human attention.

The below text is copied from the body of the original PR.

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This PR resolves 2 issues around failures during the core Apply step.

• The first is that the graph building diagnostics were lost, and no error was being returned upon failure, allowing terraform to continue.
• The second issue is that while an apply error normally means that there could be a partial state to store, in the event of an error before any apply operations have started we have no state, and should not overwrite the existing state.

Fixes #30178

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[jbardin]

requires manual backport

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