A user could explicitly intend to provide a link to a note “Te”. Obsidian does not interfere if you then type a character like | to start a display text (alias), or # to link to a header, or ^ to link to a block. If you instead want to use the suggestion, then either
hit Tab: This autocompletes the currently selected suggestion.
or
hit Enter to create the link to the suggestion, then arrow back to add the display text.
Well pressing # or ^ will autocomplete the word from autosuggestion and put # or ^ after the note’s name, even if without pressing Tab.
This is more a matter of consistency then it is an issue for me. Hitting Tab is a good “workaround” and only one more button for desired action but it is inconsistent with other two options.