I just tried a 2.50 quest, in 2.50, with the rule both on and off, and on a vertical axis, it did not seem to make any difference. Standing exactly haldway between two tiles, shots passed through Link at all times. In 2.53, with the rule ON, shots hit Link/shield at all times, and passed through him with the rule off.
If I force this on, then 2.50.0 behaviour will absolutely be incorrect.
Your patch did specifically force it on, even if the quest author set it off. That's the problem. In a 2.50.0 quest, it is absolutely always set on. Bug report IIRC was on the Discord server. (2.50.0 quests in 2.53)