Well, this is interesting.
If nothing is in PN, then the double-clicked song is added to PN (only that song, not the whole list) and starts playing.
If PN is populated and nothing is playing, then the entire view scheme I double-clicked in replaces everything in PN and then the song starts playing. (This is exactly like you describe above: correct order and all I mean.)If PN is populated and a song is playing, then the doubled-clicked song, and
only that song, is added immediately after the currently playing song.
So, yes, I confirm (I think) your dilemma. You are not going mad.
Omni
Update: The above
italic scenario doesn't happen if I change "Add to Playing Now (play next)" to "... (play now)". In other words, only that song gets added to the top of the PN playlist, not the whole list. So yes, this definitely seems to be a quirk in the "...(play next)" logic.