${project.artifactId} in parent pom.xml resolves odd

Yes, this behaviour is confusing.

Perhaps the easiest way to understand this is to consider how Maven itself is built. It's in Subversion, and the reactor poms (the poms with <modules> sections) tend to also be the parent poms of the modules themselves.

project/pom.xml (artifactId: parent)
|-+ module1/pom.xml (artifactId: module1, inherits parent)
|-+ module2/pom.xml (artifactId: module2, inherits parent)

Here, the parent pom (project/pom.xml) contains a <modules> section, and is also inherited by module1 and module2.

Now suppose the SCM URL for parent is svn://host/path/project/: what should maven do so that you don't have to specify the SCM URL again in the two modules?

Well, the SCM URL for module1 is svn://host/path/project/module1, and Maven can compute that by adding the artifactId to the SCM URL it inherits from the parent pom. It simply needs to append the artifactId to the SCM URL. So that's exactly what it does.

So that's the behaviour you're seeing:

${project.artifactId}.git becomes localized.git/localized as follows:

localized  -> from ${project.artifactId} in the inherited SCM URL
.git       -> from the the inherited SCM URL
/localized -> from adding the artifactId to the inherited SCM URL

You will see this behaviour in the SCM URLs, and (I think) for project.url and the URL in distributionMangement.site.url. However, Maven doesn't assume that the issueManagement URL structure follows your directory structure, which is why you see it inherited correctly.