True, but for many people "lose weight" is really code for "lose body fat", since that has desirable health and aesthetic benefits.

I think that this depends on your training regimen. You can train for strength, not muscle mass. This is especially important for some athletes, like cyclists, where extra weight is a liability (more mass for the same force means less acceleration).

When the gyms closed for the pandemic, I lost 5 kg of muscle. After coming back, I started doing fewer sets and have not regained the muscle mass. But my strength (the amount of weight I can lift) is now very close to pre-pandemic levels.

No, it won't, unless you are eating excess calories. It takes a lot of energy to repair muscles and grow them.

Muscles weight more then fat. This is something that easily and regularly happen. I am not even saying it is bad thing to happen.