Selectors erroneously find all entities in overlapping blocks

Originally created as MCPE-32094. I'm escalating this to MCM because it impacts development heavily.

Verification builds: Release 776295
Summary: Region-limiting selector arguments do not find entities in a region, but rather find all entities that exist in a block that even partially overlaps the region.

Impact: Detecting entities with finer grain than an entire block is difficult or impossible. Selector arguments such as r that are not integers fail entirely at limiting the range effectively.

Repro Steps:
1. Go to the center of a block, or teleport yourself there: /tp @s 0 64 0
2. Summon an armor stand somewhat away from you in the same block: /summon armor_stand ~ ~ ~0.3
3. Run /say @e[r=0.001]

Observed Results: Player and armor stand's name both printed.

Expected Results: Player's name printed alone – the radius (0.001) is smaller than
the distance from the armor stand (0.3).

Screenshots/Videos attached: Screenshots are in MCPE-32094.

Notes:
More information/examples can be found in MCPE-32094.