When "Extract the files on open" option is enabled, it works on too many files. For example, Excel XML files are really zip files, and this option tries to extract them. The mime type for these files is correct, because if you look at the properties, the options for possible applications start with LibreOffice.

Additionally, it's a little difficult to figure out that this option exists. When you go to the file properties and the Open With tab, it says that, e.g., Excel files open with LibreOffice Calc, or .tar/.zip open with Archive Manager. There is no indication at all that some other option is overriding this setup. I don't even know if I toggled the option myself, or it was a new option with that default.