This bug occurs whether or not you hide the design, and whether or not you replace the template's design from itself.
To work around it, first set the "Inherit design from master template" property, specifying the template name, (in addition to the "Database file is a master template" property).
You will end up with "Inherit design from master template" set whether you want it or not, even if you uncheck "Inherit future design changes" when you replace the design.