This Unity version will no longer be receiving patch updates.
Fixed in 2022.3 and Unity 6. This will not be fixed for 2021.3.
How to reproduce:
1. Open any project with HDRP setup
2. Create a Prefab and open it in Context
3. Right-click in the Hierarchy and select 3D Object > Mirror
4. Observe the Hierarchy of the Prefab and then the Hierarchy of the Scene
Actual result: The Mirror GameObject is created outside of the Prefab, even though the Mirror GameObject can then be placed as a Child of the Prefab and applied as an override
Expected result: The Mirror GameObject is created inside of the Prefab Hierarchy