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Loopback interface can be omitted
If you're using the loopback interface just for dnsmasq, maybe you can consider just use a different port for dnsmasq (e.g. 5353).
You can specify the port number to connect to dnsmasq in /etc/resolver/test
like so:
nameserver 127.0.0.1
port 5353
I used to use a loopback interface for dnsmasq as well but I found it a bit flaky, as it fails to start from time to time. I haven't had any issues since I omitted the loopback interface. Been running dnsmasq on my Mac without issues for years with this method.
Thanks @goofrider, I will try this when I get a chance.