I have spoken to Celemony and they were able reproduced this on their side. They believe this is a Cakewalk issue, I have reported this to Cakewalk support and they said they will also do the same. Hopefully they will provide a fix.
Here is their response to me.
Dear Mark,
Yes indeed this is the behaviour. But this is an issue on side of Cakewalk as they don’t report the correct timing to Melodyne. Melodyne ARA is completely pendent on what the DAW tells it. If the DAW does tell the incorrect data Melodyne will follow this data. For your understanding: ARA is a protocol which sits between the DAW and Melodyne so that the DAW can communicate directly with the application. The protocol itself is implemented in the DAW from the developer of the DAW in this case Cakewalk.
So this is an issue you should report to Cakewalk as they need to fix this on their side. Unfortunately this is nothing we can do from our side the only thing we can do and we will is to report this to them also.
Best,
Rob