Not ridiculous at all, why would they do a lease beyond your legaly allowed date of stay…
They don’t know all the intricacies of H1 extension and that you may or may not get it…
Fighting it will get you nowhere. There have been plenty of successes, and every case is different. Ranting about “ridiculous policies”… just won’t go anywhere here. Search LH… feel for your situation, but you need to understand how it works. good luck