Same to me, too!
I made your same tests.
May be next week release will be fixed? I hope!
=== EDIT ===
Solved for me!
Installed a new TWRP version and update worked like a charm!
Try this: https://dl.twrp.me/natrium/
Please, give us back carousel settings on lock screen! At least the capability to rotate images or an option in setup to enable it on lock screen! Thanks.