I can't speak to the dongle you're using, and I admittedly can't test this myself at the moment, but I believe that a dongle that ONLY offers USB-C to HDMI (or any other video format) shouldn't even be detected as a USB device. USB-C ports that support DisplayPort Alternate Mode, such as the 7480's, achieve it by having a native GPU output wired directly to the USB-C port, and as such, dongles don't need to have a presence on the USB data bus and therefore (I believe) wouldn't need to be detected as a USB device even temporarily. If on the other hand the dongle you're using has HDMI as well as other things like Ethernet, audio, another USB connector, etc, then that might explain the error you're seeing. But even in that case, you still shouldn't be seeing Device Manager errors about the dongle. That suggests an issue with either that dongle or the drivers on your system, potentially an incompatibility with some other driver or application that interfaces with the USB stack. Older versions of Citrix Receiver have been known to interfere with USB traffic on Dell TB16 docks, as an example.
In terms of HDMI not being listed, that's completely expected and completely unimportant. The only type of video output that USB-C supports NATIVELY is DisplayPort, and that capability is optional -- though again, it's included on the 7480. However, as you've found, there are dongles to adapt USB-C to HDMI and VGA, which is possible because the dongle converts that DisplayPort signal to whatever output is needed. The system doesn't care and in fact doesn't even know this is happening; from its perspective, it's just sending a DisplayPort signal. And every USB-C to HDMI dongle operates this way, because there is no such thing as a USB-C output that supports HDMI natively, or any other non-DisplayPort video signal.
So yes, I'm sure USB-C to HDMI adapters in general work on this system because USB-C is a standard and the 7480 includes a video-capable implementation of that standard.