The Bug

Armor stands can be dispensed inside of blocks using a dispenser, however the player cannot directly place armor stands inside of a block (also note that blocks cannot be placed in the same block as an armor stand is occupying).

It would be expected that armor stands would fail to be placed inside of a solid block by a dispenser.

How to Reproduce

1. Place a dispenser facing towards you and a lever on the side of it. Fill it with some armor stands.
2. Place two solid blocks on top of one another right in front of the dispenser. Then flick the lever.
3. ← Note how the armor stand was successfully dispensed in the block. (It also appears black due to MC-197260)

Additional Notes

This may be intentional.