Drop Allocations Broken in Party Play

When I create parties for my groups, I run with permanent allocation on at all times. In PoE1 this worked fine, but so far in PoE2 it behaves oddly.

Every now and again items will drop for a party member and then flip to another or all party members later, almost like drops are set to short allocation; but it still says "permanent allocation" in the upper right when you show the full map.

Other times items will drop for everyone, as if the allocation is set to free for all.

Note that I understand that white items and other items flagged as trivially valuable drop for everyone, even in short and permanent allocation -- so that's not what I'm talking about here. This is occurring for uniques, rares, magic, and currency items.

I understand that this is somewhat low priority vs some of the other issues; but please address this so my party can go back to being mindless loot goblins and no one's feelings gets hurt for STEALING ALL THE SKILL GEMS, ASHLEY. WE SEE YOU.

Same here.... The allocation system switches random... sometimes it works... sometimes it doesnt....

I have a feeling that it does not work at all, even with party settings plus with personal options of each individual.

here's what I was seeing with allocation behavior, something is definitely odd

In a party with FFA allocation, me with my game options set to default FFA, and party member set to default short allocation. We were in a zone created by the SA party member.
Some loot is sometimes short allocated. We think it's enemies/breakables/chests killed by the short-allocation-setting player, and only when multiple party members are nearby.
Still in the same zone, other party member changed their game defaults to perm allocation while still in the same FFA party. They broke some pots that dropped perm-allocated wisdom scrolls.