*UPDATE: Unfortunately did not resolve the crashing. Only fixed the lag/fps drops when browsing stuff on other windows while the game is running. Still an improvement, but the crashing needs to be fixed!
Solution
Go to Settings
->System
->Display
->Graphics
->Scroll down to the game that is crashing/lagging and select “Don’t use optimizations for windowed games”
Note that this disables windows auto-HDR.
Disabling it in game or just as a whole did not fix the crashing issue and I am still running the monitor as HDR, but of course the quality is worse than it was with Windows auto-HDR.
I play Wrath and Era. They seem to have been completely fixed by this. WoW only runs in Windowed or Fullscreen Windowed mode.
I believe true full screen would not have this issue and we could run the game with Windows auto-HDR on, but it is what it is.
My fonts and UI were also pretty pixelated in Wrath Classic, but with this setting the UI is no longer pixelated.
Technical Info
GPU: 7900 XTX
CPU: 7800X3D
OS: Win 11
Monitor: Alienware AW3423DWF (HDR)
Mobo: Asus B650E
RAM: 32GB DDR5
PSU: 1200W EVGA Supernova Gold
Drivers: All up to date, but tried various different ones, none of which solved the issue.
GPU currently on 23.12.1 driver, but the driver itself did not fix the issue.
Full stock system, but also had EXPO on at some points. EXPO did not make the issue any worse.
My friend is also running the game with an AMD GPU, CPU, Windows 11 and HDR, but he has a 6800 XT so I suspect this might be a 7000 -series issue.
I have no idea if this could help Nvidia users if they have similar issues, but I recommend trying it out.
More Backstory
I have had major issues with the game lagging and crashing recently.
None of the “fixes” I found online helped long term, the issues always returned.
Sometimes I got the lag to go away, but the game still randomly crashed out of the blue.
The game mostly lagged when I did stuff on my second monitor.
With Discord I could pretty easily recreate the crash by scrolling a channel/chat rapidly.
The stuff I did on the second monitor also lagged and Discord often crashed with WoW, when I got the driver crash. The game also crashed and lagged without Discord so it was not a Discord only issue. It also crashed if I was just playing and not doing anything on my second monitor.
Strangely enough there was no lag if I ran the game in normal windowed mode though. All the other games I play I play in normal full screen mode and none have had any crashing issues.
Hope this reaches the people having issues and helps someone. The game was becoming unplayable and I was considering to RMA my GPU.
I could post the various fixes, different drivers etc. I tried, but none helped at all really so don’t see a point. This fix I found out on my own and I want to share it with the community.