The bug

The preferred_path component can, in some vague undocumented way, make mobs "prefer" walking on specific blocks. If a block of less than full height is included in this component, it doesn't work as expected. The mob will not prefer to pathfind on those blocks.
 

How to reproduce

1. Download and open the attached world. It gives villagers the following component, which makes them unable to path on any block except for grass paths and diamond blocks.

"minecraft:preferred_path": {
  "default_block_cost": -1,
  "preferred_path_blocks": [
      {
        "cost": 0,
        "blocks": ["grass_path", "diamond_block"]
      }
  ]
}

2. Watch the villagers pathfind.

Expected result
Villagers pathfind equally well on grass paths and diamond blocks

Observed result
Villagers on grass paths are unable to pathfind

Notes

This affects vanilla villagers. They are programmed to prioritize grass paths above all other blocks, but due to this bug, they don't.
From simple testing, it's clear that the mobs are checking the block underneath the path instead of the path itself.