This behavior was introduced in 26.1-snapshot-6.
The bug
The markings of horses are invisible when viewed through a block display entity displaying a translucent block. Some other overlays are also affected, such as enchantment glint on worn armor; they are likewise invisible behind such block display entities.
The issue only occurs when the "Improved Transparency" setting is set to off. It may be caused by the rendering order: basic horse model > entity shadow > block display > horse markings. When the markings are rendered, they may not pass the depth check, as there is already something nearer.
The issue can be resolved. Overlays which are designed to use the same geometry to add decorations to objects (e.g., markings on horses, or enchantment glint on worn armor) could be rendered directly after the main object instead of considering them as translucent in the rendering order.
Steps to reproduce
Summon a horse with any markings. For instance, a creamy horse with a white field can be used.
summon minecraft:horse ~ ~ ~ {NoAI: 1b, Variant: 513}Summon a block display displaying a translucent block nearby.
summon minecraft:block_display ~ ~ ~ {block_state: {Name: "minecraft:white_stained_glass"}}Look at the horse through the block display.
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