If you can find even just one example that the PCF8574 works with a display in Tinkercad, then it should work.
If you can find even just one mention that there is a issue with it, then it does not work.
I can find neither of them.
Since I can not find a flaw in your design, let's blame Tinkercad. It was a waste of time. Build a prototype in the real world.