Description of problem:

I've configured dnsmasq to resolve my local libvirt VMs through using a NetworkManager file /etc/NetworkManager/dnsmasq.d/00-libvirt.conf:
-------- 8< ---------------- 8< ---------------- 8< ---------------- 8< --------
server=/libvirt/192.168.122.1
-------- 8< ---------------- 8< ---------------- 8< ---------------- 8< --------

This always worked well until today where I realized dnsmasq was updated yesterday from 2.86-2.fc35 to 2.86-5.fc35.
Since then, after connecting to Red Hat VPN, the name resolution stops functioning:

1. Before connecting to VPN

-------- 8< ---------------- 8< ---------------- 8< ---------------- 8< --------
$ ping -c 1 vm-rhel8
PING vm-rhel8.libvirt (192.168.122.86) 56(84) bytes of data.
-------- 8< ---------------- 8< ---------------- 8< ---------------- 8< --------

2. After connecting to VPN

-------- 8< ---------------- 8< ---------------- 8< ---------------- 8< --------
$ ping -c 1 vm-rhel8
ping: vm-rhel8: No address associated with hostname
-------- 8< ---------------- 8< ---------------- 8< ---------------- 8< --------

Stracing main dnsmasq instance, it looks like the request is not forwarded to dnsmasq instance dealing with my "libvirt" domain.

Restarting NetworkManager (which kills the VPN connection) makes it work again, until I connect to the VPN.
Downgrading dnsmasq to 2.86-2.fc35 permanently solves the issue: it continues resolving after connecting to the VPN.

Version-Release number of selected component (if applicable):

2.86-5.fc35

How reproducible:

Always

Steps to Reproduce: see above

Actual results:

No resolution of my "libvirt" domain

Expected results:

Resolution