Hm, that is unusual (regarding the empty barrels). On my end, with only Space Exploration and Reverse Factory, it seems that barrels can only be recycled in a tier 4 recycler. This is intended for intermediate products (including iron gear wheels), because there's a potential exploit involving productivity bonus, to limit the availability of the exploit until mid/late game.
If you can't recycle them in a tier 4 machine, then that is a different bug, and would require more information.
Although it does seem to be a bug for barrels, as they don't get the productivity bonus, and thus can't be exploited. I'll have to check that one specifically.