Again, what you are referencing is a picking issue.
The object type does exists in the project and is accessible. But on your actual layout there is no actual instance.
Best way to understand it, add a "Wait 0 action" and copy the create action under it.
Now you have two instances of Sprite in your layout and the second instance is positioned where you expect it.
Because the second "Create" action DOES have an instance to reference (which the first does not).
You are talking about clearer documentation, yet, and reread my previous messages that's what I've said all along, you're not using the correct vocabulary.
You are talking about object (in C2's vocabulary object type) when it's all about instances.
I'll amend the fact that indeed, the initial instance in the whole project is not "used", you need to have an instance in the current layout to reference it the way you are wanting to.
But again, and in regards to how picking works, it's only logical.