The divide tool has been indeed been modified slightly in one of the past releases. Previously, you had to choose a dividing point that was exactly on the entity which might have been challenging if there was no intersection point or other point to snap to exactly at that position.
To simplify that, you can now specify any point, and the point on the entity that is closest (perpendicular) to that point will be chosen as dividing point.
What you are experiencing is a side effect of that new behavior.
The best solution at this point is probably to not choose a point outside of the entity as dividing point.