Comment 7 for bug 1359547

so now I'm again on the machine where xfce 4.4 is installed.
Your explanation doesn't satisfy me (and probably lot of others)
In the current behavior dynamically set titles work only when *not* specifyig -T or --title= on the command line, which results in the default title "Untitled".
I don't want to hang around a dozen or more untitled Terminal windows housing different shells (ssh or telnet to different hosts and/or with different users). So I name the Terminals <user>@<hostname> to distinguish them. Your desribed behavior forces anybody to refrain from using anything than the default title when he likes to have dynamically set titles.
So why is the described behavior the expected one for you ?
The button in the Terminal prefs window also speaks of initial title, regardless where it did come from.