This is a feature that has been requested, but isn't implemented yet. Suggest you give it a thumbs up on github as they implement things in order of highest number of thumbs.
It wouldn't be DNS blocking. The feature request on the project is about adding an HTTPS MITM Proxy that would then do the cosmetic filters among other things.
AGH already supports adding AdGuard filters, but for obvious reasons it only applies domain based filters. Adding the MITM proxy would allow for processing of the cosmetic filters too.
No. It inherently cannot. Pi-Hole isn't a proxy where all traffic is flowing through it and has a chance to be modified. Pi-Hole is strictly answering the question, "What is the IP address for this hostname?" If a given hostname is known to host trackers or something undesirable Pi-Hole will claim it's an unknown host so the device is unable to reach it.
Does it have "cosmetic filters" (the ones that block certain elements on page) or similar feature?