Generic type sometimes returns never instead of actual template parameter type

TypeScript Version: 3.6+

Search Terms: enum, extends, never, template parameters

Code

enum FL4 { Absurd, False, True, Unknown }

type Classify< Left, Right > = Left extends Right

	? Right extends Left
		? [ Left , '==', Right ]
		: [ Left , '<:', Right ]
	
	: Right extends Left
		? [ Left, ':>', Right ]
		: [ Left , '!=', Right ]

Actual at 3.6+

type Absurd_is_never_wtf = Assert<
    Classify< FL4.Absurd, 0 >,
    [ never, '<:', 0 ]
>

type One_is_never_wtf = Assert<
    Classify< FL4.Absurd, 1 >,
    [ FL4.Absurd, ':>', never ]
>

Expected and before 3.6

type Absurd_is_Absurd = Assert<
    Classify< FL4.Absurd, 0 >,
    [ FL4.Absurd, '==', 0 ]
>

type One_is_One = Assert<
    Classify< FL4.Absurd, 1 >,
    [ FL4.Absurd, ':>', 1 ]
>
```

[MaximeKjaer]

We encountered this issue over at socketio/socket.io#3833. Here’s another minimized bug reproduction:

enum Enum {
  NAME = "name",
  WRONG_NAME = "wrong name"
}
type Name = "name";
type NameOrNull<N> = N extends Name ? N : null;

// Sanity checks:
type test1 = NameOrNull<"name">; // returns type `"test"`
type test2 = NameOrNull<"wrong name">; // returns type `null`
type test3 = Enum.NAME extends Name ? Enum.NAME : null // returns type `Enum.NAME`
type test4 = NameOrNull<Enum.WRONG_NAME>; // returns type `null`

// Unexpected behavior:
type test5 = NameOrNull<Enum.NAME>; // returns type `never`, but expected type `Enum.NAME`

[jcalz]

So then this is a duplicate/related to #21998, I think. Why can’t we have the intersection of an enum and the wider literal it comes from just be the enum? Especially for string enums, which doesn’t have the bitflag craziness to deal with?