The DelayWithFeedback, when Allpass is selected, implements a Schroeder allpass delay (as shown below), but with an inverted output:
where b0 and aM are both equal to Feedback.
When an impulse is sent into the DelayWithFeedback, you will get an immediate impulse out, scaled by -Feedback. After M samples, the impulse will appear at the output of the internal delay line; the output will be the difference of that impulse and a scaled version of that same impulse. The end result is that the amplitude of the first delayed impulse output will be 1 - Feedback squared.
We tried to replicate your result, but did not see/hear the same behavior. Can you confirm that you are seeing this in the most recent version of Kyma (Kyma 7+)?