Tech Support suggested reporting this here.

Started playing a family world (three players). All on iOS same OS and App version, all with our own Microsoft accounts. I'm the host. My son frequently gets the error message "Cannot join world the account you are signed in to is currently playing in this world on a different device." He would receive the error regardless of the way we terminate the game "Save and Quit," "Close App," "Host Save and Quit," "Host Close App."

Son is not logged into another device. We're all on the same WiFi. We've gone through all of the troubleshooting steps with tech support and more. Son CAN connect to any other world via LAN with no problems, but CANNOT connect to our "Family" world. Wife has no problems joining any worlds. We can also join all worlds that son HOSTS.

After my last troubleshooting stint I did this:

1. Settings > Creator > Delete Old Logs, all users
2. Settings > Profile > Sign out of your Microsoft account, all users
3. Settings > Profile > Clear Account Sign in Data, all users
4. Settings > Creator > Delete Old Logs, all users, again
5. Uninstall Minecraft, son's iPad
6. Factory restore iPad, son's iPad
7. Reinstall Minecraft, son's iPad
8. Login to Microsoft account, first son, then us
9. Start Minecraft world, from Host
10. Join world (via LAN), wife, then son

He connected, but the next time he played he got the error "Cannot join world the account you are signed in to is currently playing in this world on a different device." again CAN still connect to all other LAN games. 

Repeated all steps EXCEPT for:

Factory restore iPad, son's iPad

Still receives same error, and CAN still connect to all other LAN games.

I created a world copy of "Family" world and he CANNOT connect to either "Family" or "Copy of Family" world.

I suspect something is amiss in one of the Minecraft world files.

Please advise, it's hard to explain to a 4-year-old these things and causes very bad days. :/