I'd say it's probably not designed to capitalize "Jones" in this case. And I've tested it locally and it doesn't capitalise "Jones" for me either.
This is just how the PHP developers have designed the ucwords function to work, so it's out of XenForo's hands really. They could add extra logic into this title case adjustment, but there would be an infinite number of combinations of desired behaviour depending on the exact context of the title.
You can force the capitalisation of Jones in this case by typing Bob - Jones