You’re missing a key detail: the Fed returns profits, but not loan principal. If the Fed keeps a T-bill until maturity and doesn’t roll it over, then the Treasury must actually pay the principal so the money is destroyed. It is only if the Fed actually cancels government debt that we could call it outright printing.

When the base money is itself an IOU, then debt issued by the privileged party is indeed printing money, albeit money with an expiration date.