Help with what might be a bug, resulting formula damage when sheet is protected

[nje]

I have attached the sample file, it is protected with a password abc123. I did this for an elderly lady (with the help of fellow forumites) who just wanted something simple to add up her VAT, everything was OK until lastnight when she said the word #VALUE# was appearing after dragging down a cell bythe bottom right corner.
I've spent some time trying to work out what she had done and have now realised what it is but I'm sure it shouldn't be able to happen.

It's the H column that is causing the problem.
If you drag the cells using the smal back cursor it's ok
If you try to drag any of the H cells (other than the very last filled cell) using the larger thinner black cursor, you get a warning
BUT if you use the larger thinner cursor to try to drag the last filled H cell, it changes the formatting of that cell and then the other formulas lose their refernce point. It only occurs in he last cell of the column, whatever row it is on.
Should this be possible when the sheet is protected or is it a bug, It's quite difficult to explain, but I hope you can follow my explanation
Thanks