Compare running this program under Scratch 3 with this link: https://beta.scratch.mit.edu/compatibility-testing.html#249245634 Under Scratch 3 the "Button 1" sprite will be created in the Sprite1 sprite.
This is based on a bug reported by RokCoder in the forums here: https://scratch.mit.edu/discuss/topic/308114/?page=12#post-3263867