I am not aware of such bug in C3, but there are definitely logical mistakes in the screenshot you posted. Can you share your project file, or an updated screenshot of events?
I was able to fix it!
I found the mention of the Github bug repository in one of the pinned posts, and I was preparing my bug report entry when I noticed the suggestion to strip down the project to something bare-bones. I did, and I still saw the behavior as indicated.
But then I rebuilt *just* the movement scheme from the ground up, and it worked. I narrowed it down to the OR block keyboard input, not the gamepad. When I have the Keyboard "OR"'ed in to the logic per my first screenshot, the gamepad buttons do not trigger the response. When I separated it out, it also didn't work, but that helped me catch the logic error: "Keyboard OR NOT <- is down" was overriding the entire thing. "If the Keyboard <- key isn't down, set the boolean to false". Basically, when this key isn't pressed, don't go anywhere. That ensured that *only* the keyboard input would work, which was my logical error in there.
I tried to switch the keyboard triggers to "Keyboard On <- released", but I didn't see that as an option. I only saw triggers to detect "on down" or "is pressed". I tried again and noticed that "on released" appears as an additional condition only some of the time. I was clicking / wasn't clicking somewhere, and the options weren't available to me because of whatever I was doing. I'm still not sure what I was doing wrong when I wasn't seeing "on released" as an option, but that just means I'll have to poke a bit more to see what was I was clicking / not clicking in those cases.
Regardless, with "on released" set for the keyboard, it works as intended.
Here's a screenshot of the functioning logic:
To note, while the screenshot doesn't show it, I'll probably be swapping over to "is down" for the Gamepad, per your suggestion. I want to maintain consistency. In my case, though, both "on pressed" and "is down" should (and do) work with the gamepad. On pressed should trigger the boolean to TRUE, and it should remain TRUE (and thus, keep the character moving) until the button is released, which then triggers the boolean to FALSE (which stops the player). However, I think I prefer the more explicit intentionality of "on down" instead.
Thanks for your suggestion!