How can I configure more settings in PVE’s Cloud-init?

the automatic restriction on root password login via SSH in PVE’s Cloud-init
This is not governed by PVE's Cloud-init, but by the underlying image you are using. For example Debian currently restricts root access & also any password authentication by default.
To enable these you will need to manipulate the underlying image you are using. See here on a tutorial I recently posted how to do this on a Debian Trixie cloudimage (debian-13-genericcloud-amd64.qcow2).

how can I enable automatic disk expansion on startup
This again will be in the underlying image, & most of them do this automatically at first startup with growpart & resizefs

Good luck.
 
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