Instanced component's variants don't receive updates?

I stumbled upon a weird bug I can’t seems to be able wrapping my head around. My usecase is as following:

In my library file I have a local component with 2 variants called “Component content”. There’s the default variant “Green” and another one “Red”. This is instanced inside the black “Component” component, with “Component content” set to default green.

My issue is that as soon I use “Component” in other files, and make changes to any variant of “Component content” other than green, they do not propagate to instances of “component content” within “component” in other files. See demonstration below.

The library is working as intended. When I change order of text and shape in variants, both instances of “Component” reflect them: https://i.gyazo.com/d2e27d059c5f10b0ba77a778d31a7f7a.mp4

Then I have a file using the library with component, and two instances of said component, setting nested instance within it of “Component content” to green and red. After updating the libraries from first video, ONLY the “Component content” green is updated, red retains old order unless I reset all overrides: https://i.gyazo.com/532a35a7e8e8a733e0d542ab285c343a.mp4

Any idea what is happening and how I can fit it? The way I see it, it seems that updates to non-default variant of a local component instances elsewhere are ignored.

Library file: Figma

Design file: Figma

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