As expected, I purchased some non-Duracell CR2032 batteries and the AirTag is working fine.
My previous question still remains - The Duracell batteries are not defective. The AirTag should work, as they are valid batteries built according to spec. The issue is with Apple's AirTag product.
The fact that AirTags are not working with Duracell batteries, which are a very common brand, is somewhat of a known issue. When I posted on the community I was pretty direct as to what the issue is (which is a documented issue). Yet you seemed to pretty much ignore my description of the issue and reply to some very vague directions related to replacing a battery. Not very helpful....
Hopefully this post will help others when they search on the topic. For me, I found the documented issue on a YouTube video.
Cheers!