Dirt, rooted & coarse cannot be saturated (turned into mud) on the bottom face

I can also confirm this behavior. Here's a code analysis regarding this issue.

Code Analysis:

The following is based on a decompiled version of Minecraft 1.19.1 Release Candidate 1 using Mojang mappings.

net.minecraft.world.item.PotionItem.java

public class PotionItem extends Item {
   ...
   @Override
   public InteractionResult useOn(UseOnContext useOnContext) {
      Level level = useOnContext.getLevel();
      BlockPos blockPos = useOnContext.getClickedPos();
      Player player = useOnContext.getPlayer();
      ItemStack itemStack = useOnContext.getItemInHand();
      BlockState blockState = level.getBlockState(blockPos);
      if (useOnContext.getClickedFace() != Direction.DOWN && blockState.is(BlockTags.CONVERTABLE_TO_MUD) && PotionUtils.getPotion(itemStack) == Potions.WATER) {
         ...

If we look at the above class, we can see a check is specifically carried out to check what face of the block was clicked on, before allowing it to be converted into mud. If the bottom face is clicked, the interaction would fail and if any other face is clicked, the interaction would be successful. This is evident through the following piece of code:

if (useOnContext.getClickedFace() != Direction.DOWN ...

Can confirm in 1.19.2.

Reproduced in 1.20.3-pre4

Can confirm in 1.20.3 Release Candidate 1

Can confirm for 1.21.3