I’ve tested your JSFiddle on Windows 10 with Firefox 84.0.1 and 86.0a1 (2020-12-25) and I’ve enabled RDM and selected “iPhone 6/7/8 Plus iOS 11” from the menu, because that’s what I think I see in your screenshot.
With that setup I also see a difference in behavior but not in relation with touch simulation but in regard of which CSS rules get applied.
Firefox 84.0.1:
Firefox 86.0a1
So in Firefox 84 the following rule gets applied but not in 86 (again, independent of touch simulation):
@media only screen
and (min-device-width: 320px)
and (max-device-width: 480px){
html {font-size: 16px;}
}
Can you confirm that?
Sebastian