Why would you sudo rm -rf / and not expect to destroy your system? Why is --preserve-root the default when that's clearly not what the command means? Like, that -rf wipes everything recursively is one of the first things you learn with rm...
Also see https://news.ycombinator.com/item?id=19907882
(P.S. also note the question wasn't even about whether this is expected behavior, it was just about whether it's possible to lose information when using git.)