This isn't a stuck zombie but a killd one. I dont know how to reproduce this bug specifically but happens from time to time. You were in the same network bubble with whoever killed this zombie and got there before it despawned. It is a visual glitch for a dead zombie.

Can confirm. This happens on official servers as well. Not specific to the "Village" server. Same steps produce the same result. I know you already acknowledged it but just in case you needed more intel.

The game does this when your client thinks it is running in the window mode. Press Esc and get to the main menu and then hold alt and press enter at the same time. This will switch the window mode to fullscreen. Then decrease your brightness to default level and fuzz will go away. Just in case this happens again :)