If <Add Name="Authentication..."/> is uncommented in your web.config and the site is in your intranet or trusted sites zone domain users will get automatically logged in.

Good point I forgot about that setting. Everything is under a pinned "AD Setup Instructions" post at the top of the forum.

As for your second comment. No, nothing has been fixed or changed and won't be until the provider is stripped from the Core code.

If you are in a single Domain or Multiple Domain with unique identifiers, then there has been no issues that I have seen. 

It has worked especially well in my case because the domains are geography based.  So if a user moves to another geo (and their domain changes), they will not loose any of their permissions or settings.  Without the removal of the domain from the user name, a new user would be created and I would end up with a lot of duplicate users and have to be resetting permissions.