Yes, I suppose what is happening under the covers is a cheap cut and paste even though the display indicates two repeat signs at measure 1 and 32 with a 2x indicating it is reaping that section twice. I assume this is true since after I have done the first operation, what was labeled bar 33 now becomes labeled 65 (pushed out for the paste).
I also tried the using the "Song Form Dialog". Indicating measure 1-32 as A and 33-64 as B, then asked for form AABB. BIAB does the same cheap thing; copying A twice and B twice.
This behavior makes editing a section marked with repeats or as an A or B section very cumbersome. After opening a saved file marked like this and editing it, the display is no longer WYSIWYG the repeated areas are actually shadow saved and that is what gets played unless you clear all the repeats and redo them.