Without looking at it it’s probably making a unique request to a resource on a NextDNS subdomain and watching where the request comes from. Like pulling an image from (unique _string).check.nextdns.com. This requires nothing special on the client, it’s making a standard request, and as part of that it needs to do a DNS lookup.
If the source of the and your IP are similar then it’s likely the same network, otherwise it can correlate the source with known resolvers.
We can’t ever stop this kind of stuff, but with something like fail2ban you can set it up to block on too many failures.
Really though - ensuring your system is kept up to date and uses strong passwords or use a SSH keys is the best defence. Blocking doesn’t prevent them from trying a few times. Moving SSH to a non standard port will stop most of the automated attacks but it won’t stop someone who is dedicated.