lepr

Note that my somehow unhelpful video showed exactly the same technique but done with Move Tool which is available in all Affinity apps.

@Return why did my video make you sad?

There is a way with the Move Tool. An object's Transform Origin can be used as a handle. Snap it to the object's path and then use it as a handle for dragging the object until it snaps to another object's path.

snapping.mp4    

The feature seems to be working 'by design', as Serif would say.
The auto-close threshold is a constant distance in screen space rather than document space, and so it becomes smaller in relation to the object's displayed size as the zoom increases. Notice that the red loop symbol is about the same length as the pencil pointer at the moment it first appears, regardless of zoom.
The 'harder to see' is simply the poor contrast of red on the black of the stroke. As you zoom in, the black becomes more expansive until the red loop is never being presented on white.

Yes, I should have added that. PTT is actually one of my favourite tools in Affinity.

There is a way with the Move Tool. An object's Transform Origin can be used as a handle. Snap it to the object's path and then use it as a handle for dragging the object until it snaps to another object's path.

snapping.mp4    

Serif is working on a modern version of Fonthill Abbey, but if they don't seriously slow down and correct mistakes, architecture, and refactor a lot, I now truly understand how big the problem is after trying the line width tool in the beta of 2.5.
https://en.wikipedia.org/wiki/Fonthill_Abbey

This has been a general issue with the pressure feature since it was introduced in v1. 
In that sense, the new Line Width tool is apparently "only" a different front end to what's been there for a long time and only editable via the Pressure curve until now. But at least it's more convenient.
(Considering this, I can't say that I'm overwhelmed either… )

Apps: Designer
Platforms: macOS, Windows and iPad
We have made some further improvements to the pencil tool.
Firstly we are now using a new curve smoothing algorithm which we believe gives general better, smoother, results when using the pencil tool.
Secondly as has been commonly requested we have now changed the "Auto-close" method so that when you have that option checked in the context toolbar the curve only closes when you are near to the start point of the curve being drawn. You will now get an indicator when you are in range of the start position of the curve so you know when a curve will be auto-closed.

Thank you @lepr and @Alfred  The document is indeed set to 300dpi
I shall put in a request to the suggestions forum.

Affinity internally uses pixel as its unit of measure. The maximum corner radius seems to be 1991.1 px, and that is equivalent to 168.6 mm when PPI is 300.

Affinity internally uses pixel as its unit of measure. The maximum corner radius seems to be 1991.1 px, and that is equivalent to 168.6 mm when PPI is 300.

I was referring to any object with an outside-aligned FX Outline. The object is composited over an outline-coloured dilated silhouette of the object.  Reducing the opacity of the object's fill colour results in the fill being blended with the silhouette instead of concealing the silhouette.

I was referring to any object with an outside-aligned FX Outline. The object is composited over an outline-coloured dilated silhouette of the object.  Reducing the opacity of the object's fill colour results in the fill being blended with the silhouette instead of concealing the silhouette.

The behaviour in the OP's video is the "by design" (as Serif would say) result of the implementation of FX Outline.

@DarkClown Seems like the Auto-select is in Object mode despite saying Default in the context toolbar, and so your marquee selection is drilling down through Groups to directly grab the objects within the Groups - notice how a Group is only dimly highlighted in Layers panel when its content rather than itself is selected. Performing a deletion of the contained objects leaves the now-empty Groups in the document.
I have had the Auto-select behave contrary to its stated mode a few times and corrected it by toggling to another mode then back to the desired mode.

@DarkClown Seems like the Auto-select is in Object mode despite saying Default in the context toolbar, and so your marquee selection is drilling down through Groups to directly grab the objects within the Groups - notice how a Group is only dimly highlighted in Layers panel when its content rather than itself is selected. Performing a deletion of the contained objects leaves the now-empty Groups in the document.
I have had the Auto-select behave contrary to its stated mode a few times and corrected it by toggling to another mode then back to the desired mode.

@DarkClown Seems like the Auto-select is in Object mode despite saying Default in the context toolbar, and so your marquee selection is drilling down through Groups to directly grab the objects within the Groups - notice how a Group is only dimly highlighted in Layers panel when its content rather than itself is selected. Performing a deletion of the contained objects leaves the now-empty Groups in the document.
I have had the Auto-select behave contrary to its stated mode a few times and corrected it by toggling to another mode then back to the desired mode.

@DarkClown Seems like the Auto-select is in Object mode despite saying Default in the context toolbar, and so your marquee selection is drilling down through Groups to directly grab the objects within the Groups - notice how a Group is only dimly highlighted in Layers panel when its content rather than itself is selected. Performing a deletion of the contained objects leaves the now-empty Groups in the document.
I have had the Auto-select behave contrary to its stated mode a few times and corrected it by toggling to another mode then back to the desired mode.

Thought I'd show another comparison of original sketch to vector.

In that case, the functionality could have been kept and the name changed to Rectangular Brush.

If you read carefully, my first suggestion in this thread (back in 2020) was exactly that - opt/alt-click a handle.

I'm not sure if it's what you want, but opt/alt-click the Node Tool on a segment, rather than a node or handle, to completely straighten that segment.

In that case, the functionality could have been kept and the name changed to Rectangular Brush.

No you do not need to "go back to step one".
A selection of multiple Rectangle objects can have their corners changed simultaneously when any shape tool or the Node Tool, rather than the Move Tool, is active.