The behaviour is right. You have an option to include the time tracking for subtasks, since they are the children of the epic.
But, the issues shown under the section 'issues in Epic' are the linked issues connected with the JIRA issue link relationship. They cannot be considered while calculating the Epic's time tracking.
If required, you need to introduce a scripted field to set the right time tracking considering the Issues in Epic. But, you won't get an option as 'include issues' as it is available for 'include subtasks' in time tracking.
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