I run into the issue migrating the Frigate docker image to Incus but it requires quite some configuration to make it work. As I was just looking at this topic Docker OCI Parameter Passing Incus 6.3 it actually has the same problem.
What I actually have forgotten to add is the discussion around this issue PiHole - 2022.08 S6 overlay bug #1176 which properly gives you much more input about the why and how. In a gist even other virtualisation are failing in a similar way like incus does.
To test this out I actually setup a local docker repository in an Incus instance. It actually helped me a lot to solve configuration issues with OCI images.