This is simply circut bleed through. Very common. And yes it would be great if the opposite channel were completely silent but then that would cost more. I don't know that it degrades the sound, you simply have a small amount of the other channel coming through.
Does this degrade sound?
I have an Adcom GFP 750 preamp and when I turn the balance all the way to one side there is still music coming out of the the other speaker. Same when I turn the balance other way. There is no complete silence of channel. It sounds good to me when I play it but would it sound better if the balance worked 100% instead of 80%? Thanks Mike