Just to see what happens, I tried this:

M-: (setq-local comment-line-break-function #'comment-indent-new-line)

.. and then M-j started working perfectly! It worked fine both: in Org comment lines and out of comment lines.

I see that comment-indent-new-line was added to emacs in newcomment.el back in 2000. So I don't know why org-comment-line-break-function was added. May be Nicolas can comment more on that.

So would this patch work?

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From 1a9187b82ed8d4e8d54ddd369a44d34295281fc3 Mon Sep 17 00:00:00 2001
From: Kaushal Modi <kaushal.modi@gmail.com>
Date: Tue, 30 Nov 2021 20:37:10 -0500
Subject: [PATCH] org: Remove `org-comment-line-break-function'

* lisp/org.el: Remove `org-comment-line-break-function' and let
`comment-line-break-function' be the default value.

This fixes the `M-j' binding issue reported by Richard Lawrence in
<https://lists.gnu.org/r/emacs-orgmode/2021-11/msg00639.html>.
---
 lisp/org.el | 17 ++---------------
 1 file changed, 2 insertions(+), 15 deletions(-)

diff --git a/lisp/org.el b/lisp/org.el
index ec59ddf44..ee8ca1f03 100644
--- a/lisp/org.el
+++ b/lisp/org.el
@@ -19624,8 +19624,7 @@ assumed to be significant there."
 
 ;; `org-auto-fill-function' takes care of auto-filling.  It calls
 ;; `do-auto-fill' only on valid areas with `fill-prefix' shadowed with
-;; `org-adaptive-fill-function' value.  Internally,
-;; `org-comment-line-break-function' breaks the line.
+;; `org-adaptive-fill-function' value.  
 
 ;; `org-setup-filling' installs filling and auto-filling related
 ;; variables during `org-mode' initialization.
@@ -19647,8 +19646,7 @@ assumed to be significant there."
   (setq-local fill-paragraph-function 'org-fill-paragraph)
   (setq-local auto-fill-inhibit-regexp nil)
   (setq-local adaptive-fill-function 'org-adaptive-fill-function)
-  (setq-local normal-auto-fill-function 'org-auto-fill-function)
-  (setq-local comment-line-break-function 'org-comment-line-break-function))
+  (setq-local normal-auto-fill-function 'org-auto-fill-function))
 
 (defun org-fill-line-break-nobreak-p ()
   "Non-nil when a new line at point would create an Org line break."
@@ -19903,17 +19901,6 @@ filling the current element."
      (adaptive-fill-mode (not (equal fill-prefix ""))))
  (when fill-prefix (do-auto-fill))))))
 
-(defun org-comment-line-break-function (&optional soft)
-  "Break line at point and indent, continuing comment if within one.
-The inserted newline is marked hard if variable
-`use-hard-newlines' is true, unless optional argument SOFT is
-non-nil."
-  (if soft (insert-and-inherit ?\n) (newline 1))
-  (save-excursion (forward-char -1) (delete-horizontal-space))
-  (delete-horizontal-space)
-  (indent-to-left-margin)
-  (insert-before-markers-and-inherit fill-prefix))
-
 
 ;;; Fixed Width Areas
 
--
2.34.0

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