I know people in real life who are genuinely impressive at navigating complex social situations, running businesses, and solving practical problems but who would probably not score exceptionally on a standard IQ test. And I know people who score very high on cognitive assessments but seem almost helpless in real world situations. Does this mean practical intelligence is a genuinely separate ability or is something else going on?
The pattern you are describing is real but the explanation is probably not a separate intelligence factor 
What looks like practical intelligence in everyday life is usually a combination of domain specific expertise built up over years, personality traits like conscientiousness and emotional stability, and social skills that are partially independent of g. Someone who is exceptional at running a business may have average g but extraordinary accumulated knowledge of their specific domain plus the personality traits to execute consistently. When researchers have tried to measure practical intelligence as a distinct construct and control for g, the unique predictive variance largely disappears. Sternberg spent decades trying to validate it and the psychometric community was never convinced the residual variance justified a new intelligence category.
Street smart versus book smart is a real phenomenon but it is probably better explained by what someone has practiced and prioritized than by a separate cognitive faculty 
High g with zero real world experience looks helpless. Average g with decades of domain expertise looks brilliant. Experience does a lot of work that people attribute to a different kind of intelligence 