Hello @Philip DG ,
I think your understanding is correct .
MSDP is a routing protocol to be exchanged between RPs belonging to same or different BGP numbers.
With same AS --> Anycast RP with PIM SM or ASM (either with Cisco auto RP or standard based BSR bootstrap protocol introduced with PIMv2)
within same AS no RP is required for PIM SSM but IGMPv3 is required
within same AS a phantom RP on a common L3 on core multilayer switches with PIM Bidirectional
Now coming to your question I would say that what you see is expected.
the same happens in IS-IS that uses CLNP packets over L2 (3 bytes are consumed by the greater encapsulation. without IP host command the show isis neighbors should show the net and not the hostame at least this happened in IOS.
What is your context ? are you introducing multicast support over Cisco Viptela SD WAN or you are just doing labs?
Hope to help
Giuseppe