Undoubtedly. If you go poking around most any security product (the product I was referring to was not in the EDR space,) you'll see these sorts of issues all over the place.

It have to be the way it is.

Scanning them are resources intensive. The choice are (1) skip scanning them; (2) treat them as malware; (3) scan them and be DoS'ed.

(deferring the decision to human iss effectively DoS'ing your IT support team)

Option #4, detect the zip bomb in its compressed form, and skip over that section of the file. Just like the malware ignores the zip bomb.

Just the fact that it contains a zip bomb makes it malware by itself.

It does not have to be the way it is. Security vendors could do a much better job testing and red teaming their products to avoid bypasses, and have more sensible defaults.

is that endpoint detection and response?

Yes