The script does not function properly when a. A DNS is dynamically assigned and b. AUTOCFGFILES="no" is selected This is because when b. occurs ip-up and ip-down are not altered and the DNS server IP written to /etc/ppp/resolv.conf does not get written to /etc/resolv.conf
Its not a bug. If you do not want to have net.ppp0 create ip-up and ip-down (by setting AUTOCFGFILES="no"), then you have to create them yourself to setup resolv.conf.