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Hah. That's pretty bad.
That was already how it worked if you had the commander blocked, you would still be able to see and join the squads of commanders that blocked you but not people you chose to block. Backwards-ass functionality. Hopefully if they fix this bug they also let a commander's block list prevent people from /sqjoining or clicking in from LFG.
A ghost squad. Sounds kinda cool.
You can already make squads private.
I doubt that this is a bug. It's ArenaNet's interpretation of your decision to block another player as You don't want to play with that person. And honestly, I can see why they implemented it this way.
The opposite direction would be far more problematic, i. e. people could maliciously block someone, and if enough people target the same player, this player will not find any groups/squads in LFG anymore.
I think that a block should only be used, when a thick skin isn't enough, and it should only mute the other player and prevent them from inviting you to parties, squads and guilds. It shouldn't affect LFG at all. In extreme cases you can of course report another player which may or may not lead to account termination.
I genuinely also doubt that it's a bug, but if it's not it's fucking retarded and I decided to take the nicer option. Somehow I feel like GW2 is absolutely falling apart. Who in his right mind breaks LFG in such a way? Every halfway sane person would come up with block working like you described, but whoever is in charge seems completely decoupled from reality and utterly void of any reason. I can think of no other way how a mind can look at such a design and go "this is good design". So the bloke I blocked because he's a raging cunt at every opportunity now also ruins my LFG by virtue of simply existing. Amazing.
God have mercy on this game.
Is the fact that people blocked by me can still see & join my lfg a thing though?
Yes. But now YOU can't see LFGs with people YOU blocked inside. Being a cunt fucks others over twice now.
Is this actually a thing? I have hundreds of people on my block list! And LFG is barren!
NA LFG is more barren than EU LFG, so that might be another reason for you. Though it was a thing when I tested it. Gonna test it again to check if it's fixed.
Edit: it' s not fixed. If A is blocked by you and happens to be in a squad, that squad will not be shown to you in LFG. Doesn't matter if A is the commander or just some random bloke, people blocked by you also block squads they enter from being seen in LFG by you. It's fucking retarded.
It would be a major problem if it really is a thing. It would encourage people to not use the block feature.
It IS a thing and it IS easily exploited. Run aroud be a raging cunt, get everyone to block you then join the most popular meta trains or whatever.