Sounds that something is wrong with the structure.

Does the Bookmarks Toolbar H3 tag in the HTML back have the PERSONAL_TOOLBAR_FOLDER="true" attribute similar to the UNFILED_BOOKMARKS_FOLDER="true" attribute for the Other Bookmarks H3 tag ?

<H1>Bookmarks Menu</H1>
<DL><p>
 <DT><A HREF="url" >BOOKMARK</A></dt>
 <DT><H3>FOLDER</H3>
  <DL><p>
   <DT><A HREF="url" >BOOKMARK</A></dt>
  </DL><p>
 <DT><H3 PERSONAL_TOOLBAR_FOLDER="true" >Bookmarks Toolbar</H3></dt>
  <DL><p>...</DL><p>
 <DT><H3 UNFILED_BOOKMARKS_FOLDER="true" >Other Bookmarks</H3></dt>
  <DL><p>...</DL><p>
</DL><p>

Does this still happen if you delete that fake Bookmarks Toolbar folder and import this HTML backup again ?

As you can see in my above reply, in the HTML backup both Bookmarks Toolbar and Other Bookmarks folders are sub folders under the Bookmarks Menu folder, but they have a special designation that should make them act as system folders.

Thank you for the replies. The bookmarks.html file save from Firefox looks like this:

<!DOCTYPE NETSCAPE-Bookmark-file-1>
<!-- This is an automatically generated file.
     It will be read and overwritten.
     DO NOT EDIT! -->
<META HTTP-EQUIV="Content-Type" CONTENT="text/html; charset=UTF-8">
<meta http-equiv="Content-Security-Policy"
      content="default-src 'self'; script-src 'none'; img-src data: *; object-src 'none'"></meta>
<TITLE>Bookmarks</TITLE>
<H1>Bookmarks Menu</H1>

<DL><p>
    <DT><H3 ADD_DATE="1628237522" LAST_MODIFIED="1702599857" PERSONAL_TOOLBAR_FOLDER="true">Bookmarks Toolbar</H3>
    <DL><p>
        <DT><A HREF="http://google.com" ADD_DATE="1702599857" LAST_MODIFIED="1702599857">Test bookmark 1</A>
        <DT><A HREF="http://google.com" ADD_DATE="1702599828" LAST_MODIFIED="1702599863">Test bookmark 2</A>
    </DL><p>
</DL>

Yes, if I delete the fake Bookmarks Toolbar folder under Bookmarks Menu and import the file again, it puts it right back under Bookmarks Menu in Bookmarks Toolbar.