Cannot link to local HTML file

You can try the notation [html](file:///path/to/file.html).

This is not a replacement for internal links, since this notation does not allow relative paths. So as soon as you move your vault elsewhere, these links will all break.

We never supported this.

I considered it a bug, since the behavior is not consistent, even if it never worked. But you’re right, strictly speaking it’s not a bug, so raised this as a feature request now.