bazel mod graph says:

ERROR: foo@1 depends on bar@1 with compatibility level 1, but <root> depends on bar@2 with compatibility level 2 which is different. Type 'bazel help mod' for syntax and help.

but foo@1's dependency on bar@1 is fine, since it says max_compatibility_level=2. It's really quux@1's dependency on bar@1 that's causing a problem.