Thanks for the response Nat.
I'm not going to argue that it's not a bug. It is only expected though if you know what to expect 🙂
I would suggest that it is not really desired behaviour, but I do understand why it works like this. It was definitely unexpected when I first saw it, and the solution isn't obvious until you zoom right in, and watch what is happening by slowly moving the slider or moving frame by frame.
I just used the images in the example for convenience. When I first encountered it, it was with video clips where I was using the green screen to remove the background. It all worked fine, until the last thing I did was add an additional clip at the end with a cross-fade, and didn't notice the problem until I'd done the export, so it was rather annoying at the time.
I think adding a fade at half the duration of the cross-fade is slightly simpler than your solution. Dividing by two isn't exactly a difficult calculation 🙂 but both methods would work, and your solution would be better if using separate overlapping tracks rather than a simple cross-fade.
Anyway, hopefully this thread might help someone else in the future if they encounter the same issue.
Cheers
Phil