Are you sure its a level 4 beacon as it only expands 50 blocks if it is level 4
This is because the mangrove propagules has the flower tag
Do the villagers have access to beds?
I believe that that is intentional as otherwise the regeneration would become a “primary” effect as its the only one.
I believe this is on purpose as drowns cant hold players items and if a zombie picks up your items and turns to a drowned all the items/armor would delete otherwise.