What happened?

When creating an alternative layout, in the xml file the content for option is ignored.
It does not matter if you use normal text or a language constant.

In this example I use Category Blog, but it happens with other alt layouts too.

1. Create an alternative layout by copying the php and xml files for blog to your template
2. Rename the words "blog" to i.e. "alt".
3. Open alt.xml and edit the title and option, i.e. title="Alternative Blog Layout", option="Alternative Blog"
4. In Joomla backend go to Content > Articles > Options > tab Category
5. At Choose a Layout view the options

Version

6.0

Expected result

The name for the Alternative Blog Layout is "Alternative Blog".
The option can be translated when language constants are used.

Actual result

The option for the Alternative Blog Layout is "alt" (= filename).
The option cannot be translated either.

System Information

Joomla 5.4 / 6.0 / 6.1-beta3
PHP 8.4
MySQL 8.0.33

Additional Comments

Do note that when you create an alternative layout inside the original folder, the layout does display the content of option and can be translated.

So this does not work when the files are in the template folder, but it does when they are in the original folder.