I decided to make a world today and give me and my friend a little challenge. I turned the “Entities Drop Loot” option off in the world creation menu and mobs still dropped their loot. I even tried turning the option off and back on, but they still dropped their loot.
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I turned off the Entities Drop Loot option in the world creation menu and the “true” moving mobs dropped their stuff (e.g. zombies dropping rotten flesh)
Drop mob loot (domobloot) -> whether zombies, skeletons etc drop loot
Entities drop loot (doentitydrops) -> whether item frames (?), paintings etc drop their blocks
Thank you for your report!
However, this issue has been resolved as Working as Intended.
According to the 'Game Settings' section in 'How to Play':
Mob Loot: Controls whether mobs will drop loot when they die.
Entities Drop Loot: Controls whether things like minecarts and armor stands will drop themselves when they are broken.
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Have you turned Drop mob loot off or are you referring to the same option
Entities drop loot is for non-mob entities