Outposts // bug or feature?

I make an outpost right next to my city. I upgrade its armory. This makes the outpost become part of the city.

1. As far as I can tell, the armory is then worthless.

1a. Units near the city (i.e., within 2 of outpost) do not get their bonus. This seems to be a BUG to me. Confirm?

1b. The armory shows up in the inventory list of the city. I have not had the AI attack my city so I do not know if the units in the city get the bonus.

1c. Because the armory shows up in the inventory of the city and not in the outpost, I can build another armory. This second armory also shows up in the inventory of the city, rather than in the outpost itself. 

2. Frustrated by this, I raze the outpost. But the tile stays with the city. So I build another outpost in the next tile. I build an armory. This outpost also gets incorporated into the city. Now, my city is growing in length. I raze this outpost. The tile stays with the city. I am starting to build a wall. This seems great since enemies will then have to attack my city to get through. Is this a BUG or a feature?