I don't quite get what you mean by this. If you don't start with a "*", it only searches the last part of the path in the history list, so you can type in "c:", IF AND ONLY IF there's an entry "c:" in the list.
Starting with a "*"(the entire search string is "*c:\program files"), can you move your cursor through all other entries? (I can)
If you can, you also experience the bug.
Image: https://www.imagebam.com/view/MEPHEDS
In the image, if I type in "*c:\program files", I can use ↑/↓ to move the cursor through (i.e.: highlight) all the entries, which is obviously not right.
The expected behavior, which is also the behavior of TC's own search, is that the cursor can only stay on the entry "c:\program files" or can only move to other entries (if you have any) also starting with "c:\program files" (i.e. something like "c:\program files\...").