This is more of a inconsistency issue rather than an outright bug, but the block display entity renders the block from it's bottom corner upwards.
I assume this might be because quaternion transformation is easier this way (I don't really know it too well so I apologize if my lack of understanding is the issue here)
however, i still believe that as shown in the attached example with this command:
/summon sheep ~ ~ ~ {Passengers:[{id:"block_display",block_state:{Name:"sculk_catalyst"},Passengers:[{id:"sheep",Passengers:[{id:"interaction"}]}]}]}it is inconsistent for the block to be pertruding to the side from its anchor, especially alongside other entities of similar properties such as the interaction entity
This is not an inconsistency issue. The origin of an entity is usually at the bottom center of its hitbox, but display entities has no hitbox at all.
In fact a display entity takes the entity position as the origin and displays the model with the coordinates defined in the model file. It is not centered because the model is at the position that is defined by the model file.
So I don't think this is a valid issue.