subtype error with `KV<:Union{K,Ref{K}}` alternate constraint

[AzamatB]

The following works as expected:

function f(
    x::AbstractDict{KV,Tuple{Int}},
    y::Union{Set{K},Dict{K,V}},
) where {K,V, KV <: Union{K,Tuple{K,V}}}
    return "done"
end

K = Int
x = Dict{K,Tuple{Int}}()
y = Set{K}()

julia> f(x, y)
"done"

Now replace K = Int with K = Tuple{Int,Int} and now it throws MethodError: no method matching

[vtjnash]

Here's a reduction into the type domain:

julia> Tuple{Set{Ref{Int}}, Set{Ref{Int}}} <: Tuple{Set{KV}, Set{K}} where {K,KV<:Union{K,Ref{K}}}
false

julia> Tuple{Set{Ref{Int}}, Set{Ref{Int}}} <: Tuple{Set{KV}, Set{K}} where {K,KV<:K}
true

julia> Tuple{Set{Val{Int}}, Set{Val{Int}}} <: Tuple{Set{KV}, Set{K}} where {K,KV<:Union{K,Ref{K}}}
true

julia> Tuple{Set{Val{Int}}, Set{Val{Int}}} <: Tuple{Set{KV}, Set{K}} where {K,KV<:Union{K,Val{K}}}
false

Note how widening KV with that Union mislead subtyping into reporting false