I'm having the same issue trying to pair a PS3 BD Remote on a Pi 5 running LE 12 nightly from 20240106. The PS3 BD remote is a second gen one (with TV and AVR IR remote functionality) that used to work fine with older versions of LE (not sure when I last used it) and I can't pair it either via bluetoothctl or the Add On.
(I get prompts for a PIN when the remote tries to connect with the Pi5 - but 0000 and 1234 don't do anything - and I used not to have a PIN prompt I'm sure - it just paired?)
Code
Attempting to pair with 64:D4:BD:6A:C2:62
[bluetooth]# hci0 device_flags_changed: 64:D4:BD:6A:C2:62 (BR/EDR)
[bluetooth]# supp: 0x00000001 curr: 0x00000000
[bluetooth]# hci0 type 7 discovering off
[bluetooth]# hci0 64:D4:BD:6A:C2:62 type BR/EDR connected eir_len 24
[CHG] Device 64:D4:BD:6A:C2:62 Connected: yes
[BD Remote Control]# hci0 64:D4:BD:6A:C2:62 auth failed with status 0x0b (Rejected)
[BD Remote Control]# Failed to pair: org.bluez.Error.AuthenticationRejected
hci0 64:D4:BD:6A:C2:62 type BR/EDR disconnected with reason 2
[CHG] Device 64:D4:BD:6A:C2:62 Connected: no
I found this reference to an issue https://forums.raspberrypi.com/viewtopic.php?f=28&t=21045
Could it be relevant?