First I added motion tile effect to the picture, setting it as picture shown. Then I added transform and scaled it down. Next this showed. Isn't motion tile supposed to take over the whole window? Why there's still blank space on the edge? I actually encountered the same problem with mirror effect in PR.
Nothing wrong here. You need to understand rendering order. Certain effects will require pre-composing to get correct results, which is what happens here. The Transform effect simply overwrites your Motion Tile because it isn't "flattened" That said, you also likely have your order in which you apply the effects wrong. You seem to assume that Motion tile would respond to your scaling and just fill in the gaps, which again isn't how this works. Scale first, then tile.