Thanks folks, I will submit a claim for EC261 denied boarding as well as reimbursement of some expenses.

I was in the check in lineup 1h40 min before departure, and my phone records show that I first got on the phone 1h20 before departure, so I presented myself with an agent of the carrier well before cut off at T-40 . And this is after the check in agents spent some time seeing if they could figure it out. I simply wasn't on the passenger list for the flight. As I was waiting with the hold music I stood at the desk to the side of the counters (check in support, I guess?) where the rep there also waited a very long time on hold with some internal KL number and whoever they spoke to couldn't fix it either. As a friend commented to me, it would be very interesting for someone from KL ticketing to tell me what actually happened to my ticket. But I'm sure I'll never know.

Side note - the lines were moving very slowly due to the new NL PCR requirements and I saw at least 10 people who had no idea... a few of them were going home to the US...not a pretty situation.

I will update the thread when I get a response from KL.