> My question is, why?

Since that is a machine controlled by your ISP, they can do whatever
they want or do not want. Do not believe all ISP are respecting
Internet standards. Are there standards? Maybe it is a mistake in
configuration. If I remember correctly from some time ago when I read
tcp/ip illustrated but not, some kind of ARP server can be set up,
maybe bridge related, but i'm not totally sure.

So, try to bug your ISP with that ARP overwrite.

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