Alpha

It still happens in the latest version 1.16.40.02 

Yup it downloads just fine screenshot_3 is of it having been downloaded in chrome

The server logs seem to be normal however there are errors in the minecraft logs, In addition the resource pack download screen will get stuck open and softlock the player in that game state requiring the game to be restarted

It's interesting that you would say, "It can't be done without kicking the players from the server", cause I can confirm that data is being stored inside of Item tags so clearly it's not impossible...

Personally I find this functionality very useful and had up until now been considering it a feature. I would love to see it receive more support or possibly receive a more officially supported and feature complete way to edit player NBT, there are so many cool things that can be done with the ability to modify player data. And sadly execute store is still quite limited and specific another example

Yes but say Torabi was right and they do make it so u can retexture out of bounds 'Damage value' items would that make the current tags irrelevant.

Does that mean Torabi was wrong?

Just because I also proposed a solution doesn't make this a feature request, if anything it makes the bug report that much more helpful
Something is a bug if you can prove that is doesn't work as intended, as per MC-58445 Mod Torabi, states that the extra data values on Items were intended.
As such I DEMAND that u reopen one of these bugs because either way the no item texture should not exist, either way it is a bug

MC-84783 is an update on the situation

Yes its a setting For the resource pack which is part of the Api.
Also redit thing is useless as almost nobody has 10 karma

How is this not an api suggestion?
The api is the part of the program that allows you to change different stuff in game without requesting features.
Feature requests are for stuff like blocks and items and structures.
Api requests r for increased functionality of vanilla commands and resources packs.