Opening a multi-file selection opens each file in a separate instance

If you select multiple files and then press Return or click Open With App, each file will be opened in a separate instance of App.

This appears to be a regression in version 3.26.* because I recall it used to open all files in a single instance when the App.desktop file uses %U i.e. Exec=app %U.

If I instead click on Open With Other Application and choose the same app from there, then it opens a single instance, confirming that it's a regression.