Yes, but it does not appear to be listening on port 80. Note those listen statements are commented out. Besides, that server block is setup for HTTPS (see the ssl certificate and related config). Usually best to not mix port 80 and 443 in the same server block. I didn't see any listen statements for port 443 in that block. I assume they were in the include for that.
When I try your test file I get redirected from HTTP to HTTPS. While that is supported by the HTTP Challenge I don't see any redirects in the nginx server config you showed. In fact, your only port 80 server block replies with 404 to all requests. Which is what we saw in your cert request.
We need to understand why your nginx responds as it does. It is not credible that Certbot would not place the challenge token file in the folder from its renewal config file. We would be flooded with complaints if such a popular ACME Client had such a fundamental problem. There is definitely something happening with your nginx that is not explained by what you have shown so far.
Would you post the full contents of this
sudo nginx -T
An upper case T is essential. The output will be long.