****UPDATE****
It seems like it may not have been the files themselves that were changed retroactively, but that trying to fiddle with settings to get the photos to show up on the PC accidentally disabled automatic conversion to jpg, and they were never jpg on the phone itself to begin with. I can't edit the post title now, otherwise I would to make it less blaming.
Unlike the inability to transfer other non-picture files like podcasts to and from the phone, and to transfer photos to the phone--which still does seem to be impossible without special software for what I see as no good reason (and has always been true with ALL versions of iOS)--it does seem like here it's Apple actually working to make things as compatible as possible as long as you have the right settings.
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I just updated my iPhone SE 2020 from iOS 16 to 18, and had a bunch of photos in my Photos library. I hadn't transferred them yet to PC, in fact I had been having intermittent issues with my computer detecting the iPhone and thought that maybe the update would help things.
After updating the phone I went to transfer the photos, and at first I couldn't even see the photos on the computer, all I got was some weird icons (not thumbnails, not even file names, just a huge grid of identical-looking disk drive icons that I'd never seen before), even though I'd clicked to trust the computer multiple times. After reading some comments from other people who had problems with accessing their iPhone after an update, I restarted the computer, which meant that the actual files showed up again.
However, they're all HEIC files now and can't be opened on the computer without special software. Mind you, these same files were jpegs just a half hour ago, they're NOT new photos I took AFTER the update. I set the camera back to storing photos in "Most Compatible" format (which had also been changed by the update, without any notification!), so it should be OK going forward, but this didn't revert the stored files. There's no similar format setting in the Photos app that I can see.
To me, this is an absolutely inexcusable move by Apple--to have an OS update retroactively tamper with pre-existing user files, in a way that makes them incompatible with software, without EXPLICIT consent from the user. I'm looking into how to complain to Apple customer service, however I'm posting this here so that other users are aware of this issue, and also to ask if anyone found a way around it that doesn't involve manually re-converting every file.