The geometry returned from QRect KWayland::Client::PlasmaWindow::geometry () const doesnt take into account the decoration of the window. I dont know if this is considered a bug or the requested behavior. We are using this in Latte in order to check if our top bar overlaps with a window. Because the window decoration isnt taken into account the top bar doesnt hide itself in Dodge Visibility modes.
The window decoration is of course taken into account. Your bug must be somewhere else. Reassigning to KWin as it has nothing to do with kwayland. Marking as invalid as KWin passes the geometry with the decoration to PlasmaWindow.
This is in our part then... Thanks, Martin