Describe the bug
With the Finder extension enabled, all disk images in the sidebar have their icon turned into the BetterTouchTool Icon. This only affects the sidebar icon
sounds like a macOS beta bug better report to apple (but it doesn’t seem to happen here, maybe you accidentally somehow set disk images to always open with BTT?)
I totally didn't believe you at first but I tested it and I think you're right that it's a system bug. Honestly, they probably aren't going to fix it, it's a really old bug in various forms that affects external drives too. I'll try reporting it anyways.
I swear that I've seen it in previous versions though.
It's gotten better in macOS 27, the bug doesn't happen immediately anymore, I have to trigger it somehow. However, I've learned that Apple effectively doesn't look at bug reports so don't expect it to be fixed. One possible way to get around it (based off other reports) could be allowing users to disable the BTT Finder extension in external volumes and disk images