This is by design, though I also find it confusing. It has been the root of a number of bugs I've seen in Mendix applications.
You can actually accomplish a lot of date conversion functionality using the UTC and non-UTC functions, but I too wish there were a function that respected the data model localization setting.
As a general rule, make sure to always use the UTC functions for non-localized datetimes and the regular function for localized datetimes.