Is this the default behaviour/bug?
It's not default, but it is correct based on the settings in the screenshot. You are sending "pages", not the electronic document. So it is attempting to send the text pages attached to your Word document. Only image pages would be converted to PDF.
If you uncheck the "send as pages" box, it will email the Word document.
@████████But what will happen if the word document contains combination of pages with Text and Images?
If there are both image and text pages and you choose to send the pages as PDF, a PDF will be generates from the images and the text pages will be applied as a text layer in that PDF (so when the user selects text on the image in the resulting PDF, they can copy the value out).