hello, since it very very very preview and quiet new, having some bug is normal.
Since you provide the link, did you go at bottom and check the limitation ? file size, etc ?
"Defining a text formatting in the instruction isn't supported. For example, you can't set a field in bold, or add a title, or change the color.
Generating only a Word document is supported.
A document layout can't be more than 20MB.
When you upload a document layout of more than 5MB, you need to save and reopen the prompt before testing"
in the link there are the known limitation. You could add a limitation : when it's too complexe in AI builder it will time out if need more than a minute.
for last question "Is there an expected timeline for stabilization of this capability?" : it's microsoft preview :) could be tomorrow or in a one or two year :) there are some roadmap web site from microsoft but they changed the release date whenever they want.
If you wan't to work on document generation, before this feature i used a different way that i use in production.
Enable the code interpretter in AI builder (the left "....") and change model to something more robust like 4.1 or 5.
Use "document input" for a template. it will use the style template of the document (title 1, etc)
Give the structure of the document in a prompt or in a input.
Put you'r prompt to prepare content and it will generate a word document by Vibe Coding a python code wich will do the job. When you click save the "vibe python" will be saved and then the prompt tool will be deterministic.
I hope this help :) if yes please mark the answer as the good one checkbox, it's important for the community and the search engine :)