Interestingly, while still trying to figure out what is going on, I selected the "2 bottles" variant which should returnm a 2 quantity in the product quantity box. Instead, this is what it does:
Clearly, some confusion is happening here and I cannot figure out what it is
However, it l;ooks like I found the culprit. While reading the manual I found this:
If you have troubles with the display of variants of a product on the front end, you should:
1. Delete all the variants of the product on the listing of variants that you can access via the button "manage variants" on the product edition screen.
2. Delete the characteristics of the product.
3. Save the product.
4. Add the characteristics again.
5. The system will regenerate all the variants automatically and you should be able to see the dropdowns properly on the front end.
Which is exactly what I think is going on with my tests.
Still if someone knows of a good place to review the variants/characteristic workflow, I'd appreciate it.