Noticed this bug as well.
I'm not sure which scenario is correct:
1. Freeze effect is SUPPOSED to be broken by Quintessence, in which case this is not happening (functional bug).
2. Freeze effect is NOT SUPPOSED to be broken by Quintessence, in which case this is happening, but the freeze graphic is lost when Quintessence is played on the frozen creature (aesthetic bug).
Bug is confirmed on Elite Otyughs, with Congeal and Quintessence - 100% repeatable v. AI in T50 matchups.