Hi @drproton
Try using a Q-Tip lightly moistened (not dripping) with Isopropyl Alcohol 99%+ (available from electronics parts stores) to gently clean the sensor window of any grease, perspiration etc left by your finger, allow it time to dry and then check if that resolves the problem.
I suggested only lightly moistened as you don't want any liquid to penetrate through to the internal components via any gaps next to the sensor window. Also to forestall and minimize any possible damage, do this with the laptop turned off. It would be preferable to also have the laptop battery disconnected as well but as long as you don't apply too much liquid it should be OK as IPA 99%+ evaporates quickly and leaves no residues.
Here's the ifixit Lenovo ThinkPad X1 Tablet (3rd Gen) Unboxing Teardown that will help, if you do decide to disconnect the battery.
Also check in Device Manager, that you have the latest driver -V5.5.44.1058 14 Apr 2022 installed for the fingerprint reader (click on Select Additional OS > Win 11 64-bit) to get the download file.
To get to Device Manager in Win 11 to view the driver version that is already installed, press the Win key + x key (both together) and click on the Device Manager link.
When in Device Manager go to Biometric Devices > right click on the Synaptics entry > Properties > Driver