I've noticed a lot of items end up on the ground when using this mod - mostly inserters and whatever they were holding at the time of an upgrade. It may actually only be happening to inserters that are holding something during a quality upgrade, as there are relatively few them that end up this way compared to the number of inserters present.

Well, it's not just inserters. I just saw the same thing happen to one of my labs which was overflowing with spoilage. Hopefully that helps with figuring this issue out.

normally the script will destroy the item in machine box + 5tile area