I don't think it's necessarily a bug per se, but a central tradeoff in system prompt length between well-documenting the environment (harness specifics, exposed tools, tool use instructions etc) to the llm, vs the initial prompt stage ("prefill") growing so large that it results in an unpleasant lag to first response, and reduced available context, which is most noticeable with open models on resource-constrained consumer hardware.
You can use llm to optimize some of this, I condensed the tool descriptions of some larger LM Studio plugins to shrink prefill by almost 10k tokens. But there's a soft limit to this, if you don't want to under-document available tools and let the model guess (/behave unsafely).
One optimization around this is called "smart tool selection", which only sends tool descriptions when the model indicates need for a certain tool (suite), not all of them upfront.