The reason for the error was so trivial. I feel pity on myself.
SPFX v1.19.0 supports React v17.0.1 (And I was trying to use v17.0.2 through updating package.json. The project was created using No Framework option and lated I tried to add React into it.)

Related: https://github.com/SharePoint/sp-dev-docs/issues/6923#issuecomment-823610274
But why could't spfx webpart just show much more meaning message rather that showing ERROR [object Object]
Found out that the reason for getting [object Object] error was due to an unwanted localizedResources mentioned in config.json. (@pnp/spfx-controls-react was not needed/installed. Don't remember how it got added here in the first place --- ohhh, I have only installed it just to check various things)
"localizedResources": {
"HelloWorldWebPartStrings": "lib/webparts/helloWorld/loc/{locale}.js",
"ControlStrings": "node_modules/@pnp/spfx-controls-react/lib/loc/{locale}.js"
}
Related GitHub issue (super super helpful): https://github.com/SharePoint/sp-dev-docs/issues/9675