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https://steamcommunity.com/app/394360/discussions/0/4406291873009886035/
No, it's not a bug.
It's a precise and deliberate design meant to replicate the historical results of the Italo Ethiopian War, with Selassie fleeing the country and forming the equivalent of a government in exile (exactly as Poland, Belgium, Holland, France, Norway etc did during WW2) and local partisans fighting the Italian forces on the ground.
If you want to prevent that from happening, you'll need to prevent Selassie leaving the country thus preventing any formal resistance to your conquest. In game terms that means within roughly the first 70-80 days (aka before Ethiopia completes her focuses and Selassie leaves the country)
First of all, holy wall of text, geez
Once again, it is working as intended.
The war with Ethiopia going on after their capitulation is intended and is meant to represent the historical behaviour (Italy and Ethiopia singed the peace treaty in February 1947, not a day before).
You have one way to avoid the war going on, which is to conquer Ethiopia within the first 70-80 days (something that AI Italy will never do); and exactly one way to end the war after that timeframe: capitulate the nation hosting the government in exile (which typically means England).
It was designed this way precisely because the already existing government in exile mechanic could not be applied since Ethiopia isn't a member of any faction and making it a member of said faction would mean the entire faction going to war with Italy on day 1; which again is definitely not intended behaviour.
You may dislike the mechanic but it's working precisely as the devs intended it to work