1099-NEC is Services. You have the condition of Product Sales.

The 1099-K is "settlement" of Funds. Not which type of activity; it might not even be sales at all.

Two different things.

"Square then pays the Market and the Market writes checks to the producers."

Which is like sharing a credit card terminal. But if the market is the Payee for all sales, then I would read the instructions for 1099-Misc for product sales.