Hey Paul,
Well, it would seem that you've misplaced the Keyboard Maestro Editor.
Run this in the Terminal.app to find it:
mdfind -name 'Keyboard Maestro.app'
After that quit it and the engine if necessary and move it by hand into your /Applications folder.
Apple's accessibility preferences have been iffy and worse since Mojave. (Bad Apple!)
See: TIP: Resolving Big Sur Accessibility, Security, and Other Issues
-Chris