I did some more research and could solve the issue. Here is what I found out:
Apple has acknowledged a known power issue with certain 2023 M2 Mac Mini units that were manufactured between June 16, 2024 and November 23, 2024. The issue is hardware-related, and Apple has not disclosed the exact cause, but it is significant enough to warrant a global repair program.
So, I went to Apple’s Mac mini Service Program for No Power Issue - Apple Support to check if my serial number would qualify and it did. From there I made a service appointment and will receive free repair or replacement.
I hope that this information helps anyone who is experiencing the same problem.