> I'm not sure why the result would be different between
> dired-do-find-regexp-and-replace and project-query-regexp-replace, though.

project-query-regexp-replace doesn't use xref--query-replace-1.

Actually, the reported problem is not specific to xref.
Performing replacements on a rectangular region doesn't allow
searching outside the region on recursive edit too.
So here is a general fix that covers all cases: