The bug
The naturally generated furnaces in a village do not work. However, if you break the furnace, take it as an item, and place it, it will work as normal.
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migrated
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Does this also happen in 18w06a? If not, the fix for MC-125016 may be the cause of your issue.
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Yes, it happen in 18w06a; I just created a new game in that, found a village, and tried to use the furnace. It does not work, in either 18w06a or 18w07a.
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Still a bug in 18w07b.
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Confirmed, still an issue in 18w09a with a newly generated world.
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appear to be fixed in 18w20c the furnaces in blacksmith work.
wobst.michael
Yes, it looks like it's fixed.
For lava, see MC-125106.