Correct, AFAIK the main reason to not support Win16 protected mode was the size the relevant bits of HANDLEs which would have been severely limited to 16bits. Completely obviating the reason to use 64bit windows. As is HANDLEs are 32bits of significant data on at least through Windows 10. In theory now that Windows 11 has dropped 32bit support could be 64bits on Windows 11. All of this because someone will inevitably want to use the clipboard between a 64bit app and a 16bit app and it would have made things VERY painful. Could MS have written a layer that "fixed" that? Potentially but the number of people using 16bit software was relatively small AFAIK at that point.

But the page tables do technically support 16bit protected mode code when in compatibility mode under long mode AFAICT.