For some reason, immutable Linux distros seem to struggle with the idea that a single physical disk might contain both volumes owned by the distribution and persistent volumes owned by the user that are not managed by the distro. Last time I checked, Talos was basically unusable on a single-disk system if you want persistent volumes.
Sadly, most M.2 NVMe devices don’t seem to support namespaces, which would otherwise be a decent way to kludge around this problem.
Most old distros can do things like this with no particular difficulty. But the Kinoite installer (which is presumably the same as the Silverblue installer) is half-baked and buggy.