Has Spotlight finished indexing your storage? Spotlight re-indexes your Mac after a macOS update, and this process can take some time.
More info from Apple: About Spotlight indexing and search results on Apple devices - Apple Support
What you describe is not expected behavior. You should be seeing "Show Related Content" in the upper progress wheel space on your screenshot, and the lower one should have toggles to show results from Apps and System.
Here are the settings you should see in that settings pane: Spotlight settings on Mac - Apple Support
Having said that, I do not see the section for Results from Apps at all, only the Results from System section.

When I look in Activity Monitor, I do see the Spotlight indexing process (mds_stores, mdworker, etc.).
Activity Monitor User Guide for Mac - Apple Support
Even though they are not using much at all in the way of resources, that suggests my indexing is not complete. I updated to 27.2 about 10 hours ago, and as stated above it takes some time —even a day or two— to fully reindex internal storage.
I would wait a day to allow the indexing to complete. Else, you can Copy/Paste this into Terminal. sudo will ask for your password. Just type the password and hit return. It won't show anything on screen. Those two commands essentially nuke all the Spotlight records then force a reindex. You may need to restart or log out/in after running the commands.
sudo mdutil -X /; sudo mdutil -i on /