Looks as though this is actually a bug ... kind of.
The best way to think of scaling is multiplication, scaling can be defined as:
New Position = CurrentPos - pivot * scale amount + pivot.

All I mean to point out in this is that scaling is just multiplication. So by default the scaling tool lets you go to negative scaling values so you can effectively invert the model, this is a good thing! For some reason (weird), when descreete scaling is turned on it clamps the lower range you can scale by to 0 which means you effectively line up your result.
Hope thats useful for you.