Actually, that workaround is what I mean in #2
Thank you for the comments.
Just tried adding type=!villager_v2 on the list of insta-kill exception list, and it stopped killing the newly spawned villagers.
I think this can be marked as resolved now.
Thank you for the help provided!
There is a bit of a development on the bug look-up.
My brother can combine items on his device (which happened to be the same model and android version of my device), but he uses the Classic UI. No bugs have been present on that UI. When I tried to switch my UI to Classic, all the bugs were gone, but it comes back when I switch back to Pocket UI. I do use Pocket UI since only my brother have a wireless third-party xbox controller to play with Classic UI.
So far, switching UI is only an addition to possible workarounds to avoid the unmergable stacks of the same stackable item.