don’t use the whole “Use Embedded Materials” thing and switch to the legacy “Use External Materials” setting for your mesh’s import settings. That’ll create a Materials folder just like Unity used to do in the past and then you’ll be able to modify them again.
Unfortunately, I cannot unlock the materials, but only choose a shader when right-clicking (see Image). How else can I unlock the materials?
Seriously Unity, how can such a basic functionality become complicated after an update?
Most ‘Asset Greyed Out’ issues can be solved by Duplicating the item and working on the duplicate. This extends to Materials, AudioClips, Animations etc etc