I am testing/ a product account setup learning how it works, and released a firmware version V1 build with OS 1.5.2 and released V2 as the same firmware version build with OS 2.0.1
One unit was locked to V2 and did OS upgrade, but later went nuts. Releasing the lock downgrading to V1 and resetting the device worked, except the device stayed on OS 2.0.1 instead of the expected OS 1.5.2
Is it is expected behaviour and if so, how do you downgrade a product to the expected OS for that released build on a product?
That is the expected behavior. Device OS is never downgraded automatically, as you can run firmware targeting older versions of Device OS on newer versions of Device OS.
In order to downgrade Device OS, you must do so manually. It’s easiest over USB, but it is possible to do it OTA using the instructions here.