[Orgmode] %i indentation in capture templates

[Thomas Jack]

I have the following capture template:

("t" "Todo" entry (file+headline (concat org-directory "/inbox.org") "inbox")
             "* TODO %?\n    %i\n    %a")

Yet, with "foo\nbar\nbaz" in the region, this expands to:

...
*** TODO
    foo
bar
baz
...

The manual says of %i that "The entire text will be indented like %i
itself." Is this a bug, or am I misunderstanding? To be specific, the
output I expect is:

...
*** TODO
    foo
    bar
    baz
...

I'm on 7.01g.