It’s the same with the other cost reduction cards like Mochi and Herald. It also works the same for Volcanic and Windstorm Colossus.
I posted that… slightly irregular/unexpcted behaviour in #bug-reportings on discord recently. Think it should be changed to the way it was before the 10 new cards were introduced. It worked perfectly back then. Also, it’s not like it’d be op, since 1) the discount work on ANY other card and 2) you paid for the discount effect in the first place. So you should be able to receive it without being punished for fullfilling the Colossus’ own reduction effect later on.
To prevent some misunderstandings that would be created by the suggested behaviour though, I suggest some different visual effect for ‘external’ cost reduction (Mochi, Ogre Dance etc.) and ‘internal’ cost reduction (of the Colossi themselves).
Primeval Colossus, on the other hand, is clearly a bugged: It just eats up the discount effect without receiving it (just as Radiance - the last of which is intended though).