ACAtune is not required on the ACA500. All settings that ACAtune makes on an A1200 are done by the ACA500 flash. No need to use ACAtune at all, so it's not just "expected behaviour", but "intended behaviour". No need for a software update of ACAtune.
I need to work through a few other jobs before I can get back to the AC500+ACA1221 issue. Hopefully later this week. A solution is close.