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What the what? I knew of the URGENT flag but had no idea the client discarded the last byte. What is the rationale behind that?

A misunderstanding of what the "Urgent Pointer" field in the header means. I go into it in more detail here: http://blog.mecheye.net/2017/10/urg/

RFC 6093 [1] provides a bit more insight into this and other behavior.