I haven't been keeping careful track, but it may only happen on Myrror. My reasoning is that, in this game, I conquered most of Arcanus, and encountered no problems, but immediately ran into the issue with the first city I captured on Myrror.
I tried again on a Bazzite laptop. Spent a while building Dwarf cities on Myrror; over hundreds of turns and regular attacks from raiders, no glitch. I conquer a neutral town, and 4-5 battles later, the glitch happens. The trigger seems to be conquering a neutral town on Myrror; I have not seen it otherwise. I'm not sure if it's the first town I conquer, or at random. I don't think it has anything to do with the race of the town; it's happened with towns of multiple different races. I don't know if it only happens if the town has defenders when I take it.