Oh, that.
Yes, that is indeed a double head dwarf signal for the switch, the reason it's so close is the short distance between switches, I got a lot of those. Don't affect the AI, they're perfectly happy to run thru them. What I found is signal - switch - switch - switch - switch - switch - signal is a problem for AI trains, they normally set only the next switch and if that gives them a clear path to the next signal down the line away they go. Complicated junctions with no intervening signals are what screw them up, they stop and just start throwing switches in a random order hoping to get lucky and hit the right combination that reveals the path to the next signal. To fix that problem, single head dwarfs before trailing points, double head dwarfs before facing points, then the AI figures out the combination quickly.
Worst trouble with either of those is not the AI, but for the player trying to set his own path since he don't have navigate via to set it for him, switches too close together result in them huge honking red/green arrows overlapping so you can't tell which switch you're throwing.
That's primarily what this affects, the player trying to run on the mainline and the switch is set by default to diverge into a dead end. The AI has no problem since it sets the switch the way it wants, the player has to slow down or stop to check switches if he wants to stay on the mainline.
Another experiment with this - I took the template session for the AI I had set up, Edit Session and add one new vehicle and driver, set all the switches the way I want, then clicked Save expecting to get the options grayed out and forced into saving as new route and session - the hope was that the AI traffic template would come along so I wouldn't have to clone it. For whatever reason this time it did NOT gray out, so I went ahead and overwrote the existing route and session.
Now that session has all the switches set correctly, try one of the other sessions and they're back to the diverge by default. So. Probably is in the route layer somewhere, but when you create a session the information about the switch settings AT THE TIME OF THE CREATION OF THAT SESSION is stored somewhere in that session.
So the mystery is still an unsolved mystery, but apparently the trick is to double check and make sure all switches are set the way you want before you create any new sessions, because the switch settings will be locked into the new session and any subsequent session cloned from it yea verily unto the seventh generation yet unborn shall ye suffer for the sins of thy fathers before ye. Easiest cure is probably let it go new route and session after setting the switches, don't even bother trying to repair existing sessions, just make new ones since the old ones are somehow forever haunted with the Ghost of Switch Settings Past and the exorcism is more trouble than it's worth.