Thank you, @Omnimaxus. Your further clarification is again suggestive that the issue may reside in the constructs of the XML components for the Mate Panel, if not in the XML construct of adwaita, to which I was pointing earlier in another discussion on this site.
Among the list of installed files for Mate Panel listed in Synaptic, we see the following files:
but I don't see how that would tie the icon of one app with the mouseover/action regarding a different app. None of the other XML files have anything that could be related, however remotely, to icon borders or backgrounds.
The only other place that I can see an association seems to be in
Quite imperative and definitely not very polite taking into account that people contributing to the Ubuntu-MATE OS and / or the MATE Desktop Environment do their best in their free time.
Looks like only some users are affected OR not affected by the reported issues by customising the UI OR do simply not care about.
A simple report of the issue on this site and a simple bug report on launchpad.net would have definitely been enough.
By the way... YES, I had / have issues with Ubuntu MATE panels / icons... nothing worth mentioning... I just reset the panels via MATE Tweak and set them up (again!) according to my needs... not very often, but it sometimes happen (1-2 times a year). BUT, I still find Ubuntu-MATE the BEST Linux OS / desktop environment that fits ALL my needs.
I have moved on from this problem, and use Linux Mint Cinnamon now. But that doesn't stop me from distrohopping now and then out of curiosity using a virtual machine. I wanted to come back here, though, and report/share that MATE has the boundary issue, too, in other distros. For example, I tried Trisquel MATE, and was surprised to see that it has the same issue.
So it's not just Ubuntu MATE. I took another look at the MATE website (https://mate-desktop.org), and saw that Martin Wimpress is the lead for MATE development, too. I still haven't heard back from him. I'm not going to follow up. But I did see that they have a Reddit subreddit thread (focused on MATE), so I'm gonna report the issue there, too, and hope someone "official" from MATE replies. Would like this issue to be fixed in the future.
Well having read this whole discussion I for once haven't seen this problem ever not on Mint MATE nor on Ubuntu MATE, but that just might be because I colour my panel with a blue hue since I use mountain/nature/blue sky as a desktop picture and I just don't use different/fancier applet looks over the default ones (that look stunning and professional imho)
The first picture posted shows totally different indicator to what I see in options to add to panel (my version looks like a clock and is round and as is described in latter comments)
Secondly, it might be theme dependent since I use dark theme and when I click on applets they get darker squared when they are clicked on to indicate what applet I decided to click and nothing remains circled/marked after I click away
All my icons look different than what is on your screen so it may be you're using a theme that is incompatible with those applets
Also regarding your "live USB pictures" answer - now I see the same icons I have but I don't see the blue box circling around the icon so my take is - don't use MATE set of icons without a blue coloured panel if that little thingy bother you to such a length and also when you add/delete applets and something happens just reset the panel otherwise you are dragging the issues that can easily be solved with one simple reset
Another point to add is - virtual machine may not be a completely bug-free experience and isn't as strong of an evidence of "bona fide bug" to use your words since the experience may not be the same as to one installed on real machine and also - please keep the discourse civil and polite as was commented in earlier posts.
When I had issues with the panels and icons/applets I knew I had them because I was fidgeting them on the first day of the setup so I reset panels and sort them out again in a way I want them after a day of fidgeting and they, after the said reset, stay the same since I don't drag along all the bugs created with messing around with them too much and to me its ok since in the end it works, everything works perfectly.
With your statement "MATE needs an overhaul, big time." - I disagree, MATE is awesome the way it is and I love it for its simplicity and vast degree of customizable options it provides - you may not have such grave bug that bothers you on a DE that forbids you to move an applet let alone make bigger changes so it may be a better experience for you and that is totally ok - to each their own.
Ubuntu MATE 24.10 was released yesterday. @Wimpy himself acknowledged bugs with the 1.28 version of the MATE desktop. I don't know for certain if he was talking about what I originally reported, but I sure hope he saw my bug report on Launchpad and this thread I started about the boundary lines. I can't try out 24.10 at the moment, but will eventually later this week or so. Martin also said he pushed 1.28 back to 1.26 for the Oriole release, so that's a good sign. If the boundary lines aren't there, then boom, great. I just wish 24.04 didn't get released with such a buggy MATE desktop version. Where's the oversight? Where's the quality assurance? That's what surprised me the most about all this. Again, I can't try out 24.10 until later, but I sincerely hope I don't see the same behavior I saw in 24.04. If I do, then ... dunno what to say. If I don't, then great. Wish @Wimpy would come out and describe and acknowledge the exact kind of bugs he was referring to in his 24.10 announcement, too. But yeah. At least we're back to 1.26, and that says something.
If you are so strongly opinionated about this particular thing I would suggest to you and fully encourage you to take your free time and make the solution for the problem and send the code you developed for the solution of this issue to the MATE desktop team - I am sure they would all be happy and it would make you happy as well because not only will you be fixing the problem - you will also help in making the already great DE a bit better one code at the time
People with determination can achieve great things and I can read the determination in your words in regards to this topic and so I say go for it - be the change you want to see in the MATE desktop
As others have confirmed, I can see the same behaviour on my machine after adding the inhibit applet to the panel:
The glitch can be eliminated (temporarily at least) by replacing the panel in a terminal:
mate-panel --replace &
exit
The glitch will return any time I right-click on the inhibit applet icon and then interact with the indicator applet. A left-click (i.e. enable or disable screen saver) on the inhibit applet did not cause the glitch to return - so it essentially functions without the glitch as long as I never accidentally left-click the icon.
Quite a weird one!
The same glitch can arise in the brightness applet (which is also part of the mate-power-manager) ... so my guess is that the root cause is some (dependency) that is shared by those apples; or some incorrect usage of a library (or API) that both applets use.
Lastly: I'm absolutely thrilled with Ubuntu MATE. I had a few bumps installing 24.04, but given that packages in 22.04 were starting to fall behind, I'm much better off now.