PDF Save Dialogue: "Preserve Illustrator Editing Capabilities" stops image compression occurring

I have some clients that need to edit PDF files after I send them through - and these files often use placed and embedded images.

For years, my workflow for them was to use "preserve illustrator editing capabilities", but use the compression options in the save PDF dialogue to make images in the documents smaller.

However, some time ago, this stopped functioning - and using preserve illustrator capabilities started to prevent the images from being compressed, even if the options were all selected to compress images correctly.

Save file with compression: 100kb-5meg.
Save file with compression + preserve editing: 80meg, 200meg and so on.

The compression down to the saved proportions just is not happening when preserve is checked.

My existing workaround is to manually editing images into their correct end-state resolution/size in photoshop, then saving with preserve on - but is there a different/new workflow that I can adopt that doesnt involve doing this manually for each image, while also avoiding the issues that unchecking preserve editing has for future edits (flattens transparency, segments objects, groups entire objects together into one blob group with a mask, etc).

I'm aware of other options like optimizing in acrobat, but there's a loss of editing functionality there as well.

Is this a bug? Or do I just need to shift to a new workflow?

If there's a simple solution I'm all ears 🙂