Yes: edge cases are always a pain when doing optimizations. The XQuery spec is a bit ambivalent about this: it gives a lot of license for rewrites to change the error behavior, but is a bit ambivalent about the effect on precision: the note in 3.5.1 about transitivity of value comparisons is essentially saying "we know there's a problem because value comparisons aren't precisely transitive [and therefore rewrites might change the result], and we're not telling you what to do about it". This one seems a similar case.