As OP notes, there are certainly some small fraction people with worse outcomes. But the generic "long covid" term has mixed up all sorts of things -- from hospital syndrome (absolutely real! but very rare!) to symptoms that anyone would completely disregard prior to 2020 as "a head cold" (very common!)

Also, of course, there's a ton of motivated reasoning surrounding this topic where people are in forums and comment threads attributing every symptom under the sun to Covid, and dredging up bad observational studies to support their claims. The link to dementia likely falls in this bucket. It's not coincidental that most of the people to get seriously ill with Covid were/are old, and that most of the people who get dementia are...old.