I actually own many Dungeons and Dragons sets, which I have probably tarnished the value of by wearing out the various books on lore and by opening up the packs of cards, figures, and other game pieces. That being said, alignment had always been a fundamentally interesting aspect of the game because of how the world of D&D can fit all characters, monsters, creatures, and any other sentient being into 9 distinct categories based on their sense of ethics (or lack thereof).
However, this is absolutely problematic when applying to real people for various reasons. After all, alignment was never designed to be applied to real people in the first place. I would not be too bold as to claim that alignment is the largest system that is being used in the general populace, that also has no real psychological roots. Temperaments, MBTI, Enneagram, Socionics, Psyche-Yoga, and most other typology systems were all designed with the intent to help with psychological human development. Not once in any D&D rule book have I ever seen a passage that advocated for applying alignment to real people. I have no clue on who originally decided to apply alignment to humans, and I do not necessarily look at this person in mind with contempt. However, I do currently assess alignment as a clinical failure, when considering the current 'meta' of typology systems.
Looking at human intent as a concept is clear with the majority of why this is the case. Let me paste some descriptions from the easydamus site, which many people use for not just reading the descriptions of alignment but also taking the commonly accepted test (I should also mention the test was meant to be taken in lieu of your own role play character, not for your own opinions on various issues).
"'Good' implies altruism, respect for life, and a concern for the dignity of sentient beings. Good characters make personal sacrifices to help others.
'Evil' implies hurting, oppressing, and killing others. Some evil creatures simply have no compassion for others and kill without qualms if doing so is convenient. Others actively pursue evil, killing for sport or out of duty to some evil deity or master.
People who are neutral with respect to good and evil have compunctions against killing the innocent but lack the commitment to make sacrifices to protect or help others. Neutral people are committed to others by personal relationships."
You can see with these loose constraints that the absolute majority of people, into the high 90s in percentage, would identify as good or neutral according to these definitions alone. Most people who identify as evil are clearly being contrarian, with real evils being people to genuinely look out for in a society. I do not have to talk about Law vs Chaos as a dichotomy for sake of the greater point I am about to make, but I am sure it can be analogous in some fashion.
This classification system creates problems when viewing people from the outside, as alignment clearly factors in ideas that can only be seen from the inside. This is clearly not a problem however when playing a role-playing game where the dungeon master knows every NPC's intentions, and all players know the intentions of their own playable characters. We do not know for certain the true intentions of anyone in the real world, really. I do not possess a relationship with other humans that can be directly analogous to the relationship between me and my created character in a game. I suppose in the most extreme cases, we can see what subjects may fall under these definitions, but many humans do not fall under such terms. This point becomes more abundantly clear with consideration to typists, who either refuse to apply the definitions at all, or apply the definitions with intense subjective value. In some sense, we as humans all fall into the latter category, because we simply cannot set aside our own biases, prejudices, and experiences. Therefore, no one is suitable to be a good judge of alignment. And even worse, by these definitions, awful people can classify as "Good" solely because their intent was out of concern for humanity. You can see the slippery slope with how far you can get with this, and I do not think I have to be specific with the imagery I am placing in your mind at this moment.
Alignment is its own metalanguage, with its own jargon definitions for good, evil, neutral, law, and chaos. But, I think as a typology system, it struggles to find its own purpose in a way that is not merely as a red herring to every other typology system in existence.