I am aware of the recent change to pistons (From the Minecraft Wiki: "Blocks now lose their waterlogged state when pushed by a piston.") but I want to find out if this change was intentional or not, because to me, it just wouldn't make sense for a retracted piston to act as a normal block in water.

Something else I noticed while testing it, when it pushes a waterlogged chest, it removes the water completely when the chest is moved (part of the bug that was fixed). I'm not sure how this worked before the 1.16 update, if the piston moved the water with the waterloggable block or if the piston only moved the block, not the water.