Confused about non-physics parent causing transfrom not to be updated

[khoda81]

In the docs, it is stated that having a physics object as a parent causes transforms to be updated in such a way that the parent and child move independently of one another, so I was very confused when adding a non-physics entity (with or without Transform) as parent causes transform of the child not being updated even though the object was moving in the world (Position and Rotation were being updated) which left a ghost sprite with the physics object somewhere else in the world.
Here is the minimal reproduction:

let mesh = meshes.add(Rectangle::new(150.0, 200.0));
let material = materials.add(Color::srgb(0.3, 0.3, 0.7));

commands.spawn_empty().with_children(|parent| {
    parent.spawn((
        RigidBody::Dynamic,
        Collider::rectangle(150.0, 200.0),
        MaterialMesh2dBundle {
            mesh: mesh.into(),
            material,
            transform: Transform::default(),
            ..default()
        },
    ));
});

Looking in the code, the query of update transform system from the sync plugin seems to match this entity but does not update the transform anyway.

FYI: I need this parent relationship to represent the ownership of player (physics entity) by a controller, so I don't want the parent (the controller) to be a physics object.