I would say that this is the intended behaviour, as the plugin will try and build all triggers regardless of the results of each trigger. This is required in some cases where all of the child projects need to run but have different sets of parameters.

If you have the second child job not run if the first fails add a separate second trigger build step for that project which will not run as the first build step will have caused the build to fail.

trigger buildstep 1
child 1
parameters
fail step if triggered project fails.
trigger buildstep 2
child 2
other options

Intended behaviour of the build step.

Thanks for that idea, that never occurred to me.

Maybe a good idea to add this to the help somehow. I found it confusing that the "fail this build step" option still triggered the next build. But it was of course still the same build step, so it makes kind of sense when you think about it.