No.With this kind of argumentation anyone could justify any still existing bug in the game as "working as intended" if hes not interested in a fix.
If there is a funds limit and the game allows the player to break it somehow, that does not work as intended and is a bug. If you can't distribute skill points although the documentation says you should, that's not working as intended and is a bug.
If you're not allowed to capture an enemy artillery piece with your own crew, you can say that you should be able to do that, but it's working as designed.
In the Encyclopedia page for "Battle List", it says "Battle List battles do not count against the Leaderboard or Clan Competition, but will allow the upgrading of your avatar, the exploration of provinces and all other avatar progression".back it up with substantial reasons or evidence
So I guess you're right, it's a bug. Classic Battles shouldn't be available from the Battle List at all
But seriously, there is no reason at all to put Classic and Avatar battles together; people play either one or the other. The easiest thing I can think of is the battle list remembering what filter you chose in your last session.
I'm sure CA has numbers on how many people play avatar and how many classic, and there aren't enough classic people around to make a design change worthwhile. It may in turn result in more players starting with classic by tricking them into those games; but really, why would CA want that?