Is this bug or meant to be this way?

I finished the new story, "A bug in the system" and got the achievement unlocked to get the new bag.I thought ok, since i've bought the portal, i'll use one of my different characters that i'm learning to use and run around and complete this 32 bag archievement.But it seems like the kid at the south entrance only accepts the item from the character you originally finished the story on.He only talks 1 line and and doesn't accept the 20 slot bag from my other character. I haven't used the bag so its not soul bound to any character yet.Is this meant to be like this?

Yes you have to have finished the story on the character you do the scavenger hunt on.

The "quest" that gives you the 32 space bag is a collection. Collections can't be repeted therefore you can only get one 32 space bag trough collections. You can craft them though after you have unlocked it the first time. I have seen some estimation about 1 costing around 250G-300G to make though.