I started a new save of the game and set landfill cost to 2, making it 20x cheaper, because I didn't want to have to deal too much with that logistical challenge of the mod. However, I've unlocked the Voidfill research and it takes 28s to manufacture, which isn't proportional to the decreased cost of the landfill recipe by stone. Is this a bug, or is it working as intended?

It's working as intended in the sense that the formula is spitting out the values that it should, but it doesn't make a lot of sense for very low landfill costs. I changed it so that if the landfill cost is below 20, the voidcrafting time is just double that, so in your case it'll now take a much more reasonable 4 seconds.

If my math is correct landfill recipe gives you ~0.021p/s, while if you craft landfill from stone you get ~0.425stone/s / 20 stone/landfill = ~0.02125land/s. Plus because of craft time stone gives you 20x void shards for science. AFAIK the only reason why you would want to use landfill recipe is to not having to deal with prismite.

I don't think your math is correct... voidcrating landfill takes 40 seconds with an 85% chance of success, giving you 0.02125 landfill/sec. Rate Calculator shows 0.021/sec but that is because it truncates decimal places. Changing the mode to "per minute" shows the correct value of 1.275/min.

As such the only tradeoff is, as you've observed, getting 20x the shards for science, but also 20x the random junk. Landfill's random junk is arguably more immediately useful, too. Especially in Space Age, where you also sometimes get foundation, which actually increases your chance of getting "something you can put into the water" to 89.5%.