Sorry to hear this is giving you trouble. Yes, the blurb and news widgets should support the “tag” argument.
I wonder if something else is preventing the intended result from showing up – could it be Hidden, have a Privacy setting on it, or something else that may be conflicting with other settings of the widget you’re using? Hope this may help!
Also noticing that even when the widget template is not including an image, the output of the widget includes an image in the widget builder. Not sure if this is a bug.
The empty args are for when you blank out or override something from the widget template, so that’s to be expected there.
If you wanted to spell out some steps to reproduce (for example, “save an item with tag=this and make a widget like that”), we could try to reproduce on our own servers. Otherwise, it may be something that needs a closer look at for your specific instance, and you could reach our via your personalized email address to allow us to log in and see what’s happening.