Dealer confirmed that 'this is the way it is now'. They're opening an 'info case' to BMW NA now to get a reply from corporate for me. I'm fairly annoyed, in a week and a half driving this way, I still try and use this feature at least once per trip and flub it because I have to pause and think about it and then rev match myself. I shouldn't be cursing at my very new car just because they did a software update.
Note that I didn't say it doesn't rev match in every gear, only that it only rev matches in single gear downshifts not 2+, and not if you start from neutral with clutch out and then clutch in and select a gear.
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