Extracting from #44484 (comment): there appears to be an issue with the margin visualization, where if you apply margin to, for example, a group block, the visualization resizes inwards as if to indicate padding, instead of outwards. GIF showing this:

In an older iteration, this worked as intended:

It isn't clear when this regression happened. I've seen it work prior to #44323, but it isn't clear that PR introduce the regression either, please see additional context here.