Gnome version: 3.32
Dash to dock version: 66
Os: Arch Linux

Can confirm. Same OS, same version.
I have the same problem - however, this only appears when I'm using the Arc-Dark shell theme (latest from AUR). It could be some interference from shared/overriding CSS files.
Same thing happening here
Enabling the 'Shrink the dash' option in the 'Appearance' tab of the Dash to Dock settings stopped the behavior for me. I'm using the Arc-Dark application theme as well.
Obviously this does change the appearance of the dock, but I use the intelligent autohide option anyway.
@purpleshell it's a good workaround, but not always pretty:

An other workarround is to maximize the dock, like ubuntu style
I have the same problem - however, this only appears when I'm using the Arc-Dark shell theme (latest from AUR). It could be some interference from shared/overriding CSS files.
It happens to me while using regular Arc too
I can confirm this is still happening here, same OS, same theme...
Most helpful comment
Enabling the 'Shrink the dash' option in the 'Appearance' tab of the Dash to Dock settings stopped the behavior for me. I'm using the Arc-Dark application theme as well.
Obviously this does change the appearance of the dock, but I use the intelligent autohide option anyway.