Hello Kevin,
ah, understand. Thanks for the clarification.
Since I don't need rewrites to external urls I have not experiences on that. Sorry, that I can help.
But since you wrote that your requests "hang" for 60 seconds I think that your assumption is right and the instanciated cloud function doesn't handle the rewrites correctly. The standard execution time for the cloud function for the next.js ssr is 1 minute (unless you defined something different in your "firebase.json" file).
You should probably file an issue in the firebase-tools GitHub repo:
The contributing developers already did a great job on making next.js deploys on Firebase very easy. I am pretty sure that they'd like to fix issue, too.
Best,
Doc (Marco)