piratejabez

I encountered a similar bug that does not seem to be affected by whether the stroke is inside/outside/center, but rather rounded corners. When I expand a rounded rectangle, the straight edges "bulge" ever so slightly from the corners (the corners are fine).
 
Please see attached screenshot—the blue stroke is before expansion and yellow is after (green is overlap).
 
Thanks for looking into this :)

Transform each is one of two critical features (select by attribute being the other) that prevents me from jettisoning Illustrator from my Mac. I'm surprised that these features have not already been addressed at 1.5, but hopeful they will make the roadmap soon. It may be that those using AD for "artwork" illustrations don't use these features very much, but those of us doing technical drawings and graphs absolutely need them, and their inclusion would, I think, greatly expand the user base for AD (at the expense of Adobe). 

Text styles are in the current 1.5 beta, and should be released to the Mac App Store in a couple of weeks.

We're re-considering. The next beta will use alt-arrow keys for kerning, tracking and leading (with alt-cmd for bigger changes). Cmd-arrow will do word movements, and ctrl-arrow will do start/end of line. This is something of a trial, to see whether not having the OSX standards is more annoying than not having the Adobe standards. In the long run we'll make it customisable somehow.
 
Incidentally, Designer supports both tracking and kerning independently, but only one at a time is shown in the Character panel, depending on whether the text selection is empty or not. We should be improving the Character panel at some point.

AD on Windows beta 1.5 already does this. :)