Webhook validation handshake failed with response code unknown

I'm unable to update the webhook endpoint of Event grid subscription. I've created a new http triggered azure function and I'm trying to update the webhook endpoint point of an event subscription to this new function.

After update the endpoint and adding x-function-key in Header in Delivery Properties, I'm getting an error while saving it saying:

Deployment has failed with the following error: {"code":"URL validation","message":"Webhook validation handshake failed for https://eventgridl3functionapp.azurewebsites.net/api/eventgridl3functionapp. Http POST request failed with response code Unknown. For troubleshooting, visit https://aka.ms/esvalidation. Activity id:5dae7825-6144-4d9d-8adf-3b764bb6a7f7, timestamp: 8/8/2024 5:22:40 AM (UTC)."}

Could anyone assist me in debugging this?

I was able to update the event subscription webbook endpoint few days back and then I updated the http trigger function (removed some unnecessary logs from there) and now I'm unable to update the endpoint. Can I find specific error using the Activity Id?

Not sure if it's related but found this in application insights traces and exception - "Category":"Function.EventGridL3FunctionApp","HostInstanceId":"aa480e87-5e33-498e-ae82-c36aec5c20f5","LogLevel":"Error","prop__{OriginalFormat}":"Microsoft.Azure.WebJobs.Host: Error indexing method 'EventGridL3FunctionApp'. System.Private.CoreLib: Could not load file or assembly 'System.Linq.Expressions, Version=8.0.0.0, Culture=neutral, PublicKeyToken=b03f5f7f11d50a3a'. The system cannot find the file specified."

This is the code for how I'm handing the validation event but it seems it is not even reaching to this function because there are no logs for "HTTP trigger received" in application insights.