I haven't been able to reproduce the error in v1.85.
With "Keep removed users in database" on, when I delete an Active user they end up flagged as Removed, and when I delete a Removed user they are deleted from the database. With "Keep removed users in database" off, when I delete an Active user they are deleted from the database.
Can you confirm this behaviour and tell me the exact steps to recreate it? Please make sure you're using the same list throughout.
Regards