Fix: Display the correct title for templates from theme

src/BlockTemplatesController.php

@@ -184,6 +184,28 @@ public function add_block_templates( $query_result, $query, $template_type ) {
 		// We need to remove theme (i.e. filesystem) templates that have the same slug as a customised one.
 		// This only affects saved templates that were saved BEFORE a theme template with the same slug was added.
 		$query_result = BlockTemplateUtils::remove_theme_templates_with_custom_alternative( $query_result );
+
+		/**
+		 * WC templates from theme aren't included in `$this->get_block_templates()` but are handled by Gutenberg.
+		 * We need to do additional search through all templates file to update title and description for WC
+		 * templates that aren't listed in theme.json.
+		 */
+		$query_result = array_map(
+			function( $template ) {
+				if ( 'theme' === $template->origin ) {
+					return $template;
+				}
+				if ( $template->title === $template->slug ) {
+					$template->title = BlockTemplateUtils::get_block_template_title( $template->slug );
+				}
+				if ( ! $template->description ) {
+					$template->description = BlockTemplateUtils::get_block_template_description( $template->slug );
+				}
+				return $template;
+			},
+			$query_result
+		);
+
 		return $query_result;
 	}