It's not a bug, it's by design. You're a feudal ruler and heavily dependent upon other characters in governing your clan. Making some 60-year-old with bad health your master of arms and sending him out building castles is a gamble from your side. In a succession, it'll only happen if your heir was landed and had his own master of arms, in which case he'll probably out building a castle of his own... If you want total control, don't hand out land to your heir and he won't get any ideas of his own regarding what castles to build and who to make master of arms.
Someone made a really bad call then. And you've gone above and beyond in your response trying to justify it... and it's just making the situation worse. And nobody was complaining about successions, but you've pointed out that this irritating problem will rear it's head there too. Just to re-iterate.
You appoint a Master of Ceremonies.
That Master of Ceremonies is told to begin building a village improvement.
That Master of Ceremonies dies 3 days before the improvement is finished.
As a consequence, the village improvement is incompleted, you must appoint a new master of ceremonies, and the village improvement starts over completely from day 1, INSTEAD of having only 3 days left before completion.
This sounds like a bug to me.
If it's NOT a bug, then whoever made the call on having something that annoying be part of the game design needs to get reprimanded for having incredibly bad ideas regarding game design. Because it's not only unrealistic, it's also incredibly annoying, which detracts from the fun factor every time it happens.
EDIT - And even your rationale for why improvements should need to start over from scratch if your character dies and his heir takes over is terrible. I would LOVE to see some historical references that would prove it was a COMMON occurance for an heir to succeed his father and say "Oh...you know what, that castle that my dad was building that is 95% complete....yeah, I'm going to ignore that completely and start a new one from scratch." Because I highly doubt you can find any sensible examples of that which can have an argument made for why it's acceptable to deliberately make a bad decision as far as game design.
If it looks like a bug, people are complaining about it being a bug, the worst thing you can do to your constituency is say "no, we did that to you on purpose, deal with it."
EDIT # 2 - On top of that, feudal society relied incredibly heavily on apprenticeships. It makes no sense to say "well, your master of arms is dead, and he had absolutely no apprentices working under him on the project that would be able to relay the project designs to the new master of arms competently enough that he could, at the very least, pick up where the old master of arms left off."
You couldn't become a master of anything without being taught first by someone else how to be, at the very least, proficient with something. Apprenticeship was a fact of life.