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I think your first example highlights the drawbacks of derived state. I think the situation of selected user “coming back” when that user is available in backend data is almost never wanted in practice?

I think you introduce a new class of problems it becomes difficult to reason about UX as server data changes. Client state being explicit with effects and state may not be easy, but it is simple. You render what is in client state that’s it. You want to render something? Put it in client state.

The state syncing bugs you get with that are way worse imo. See the buggy default-value example at the end of the article.

Couldn't you have these kind of transform in select? That's usually where I "derive" stuff if I can.

Select transforms server data. Here we want to alter the client state depending on server data.