This appears to be a commonly-occurring problem independent of computer spec, I can confirm I experience it too.
Hybrid input is enabled and whenever I touch my mouse or keyboard, the game freezes and mutes for a second. When I then touch one of the inputs on my controller again, it freezes and mutes again.

I experience this when I'm trying to use my Steam Controller with the right touchpad configured for mouse input for more precise and natural camera control while the rest is configured as gamepad. I can work around it by configuring the controller for gamepad input only, but that's not quite as good.

This coincides with all the control glyphs being swapped out for keyboard/mouse glyphs (or kb/m to controller), so perhaps it has to do with the game accessing some compressed/encrypted resource file on disk?

I believe the UI display change could be indeed causing the issue. I also would have an additional request: make a menu option to force showing the gamepad UI only while playing with Hybrid input. Not only is the sound muting/freeze unacceptable but the UI changing everytime I would touch the trackpad would just be a distraction even if it worked otherwise fine.

Also: I have not even tried photo mode, so I don't know if the issue is there as well, but it's certainly not the (only) cause.

This appears to be a commonly-occurring problem independent of computer spec, I can confirm I experience it too.
Hybrid input is enabled and whenever I touch my mouse or keyboard, the game freezes and mutes for a second. When I then touch one of the inputs on my controller again, it freezes and mutes again.

I experience this when I'm trying to use my Steam Controller with the right touchpad configured for mouse input for more precise and natural camera control while the rest is configured as gamepad. I can work around it by configuring the controller for gamepad input only, but that's not quite as good.

This coincides with all the control glyphs being swapped out for keyboard/mouse glyphs (or kb/m to controller), so perhaps it has to do with the game accessing some compressed/encrypted resource file on disk?

I believe the UI display change could be indeed causing the issue. I also would have an additional request: make a menu option to force showing the gamepad UI only while playing with Hybrid input. Not only is the sound muting/freeze unacceptable but the UI changing everytime I would touch the trackpad would just be a distraction even if it worked otherwise fine.

Also: I have not even tried photo mode, so I don't know if the issue is there as well, but it's certainly not the (only) cause.