I have reproduce it on a fresh installaton without anything else and basic configuration and
I confirm that the blocked users in list are hidden from users who don't have a special right level, registered users for exemple can't see blocked.
I am clearly referring to user list, not profile.
I my project it could make sens to access to former workers, the list shoulf be enough, thoses workers are no longer allowed to connect, but we have to provide a list of them accessible for all users.
Eric