This is no BUG. Uninitialized variables will contain random values.
Try assigning a value to your word variable, and then see how it works.

Code:
init:
	decideInterval var WORD
	TIMEINTERVAL con 600

main:
	IF decideInterval = TIMEINTERVAL then
	   decideInterval = 0
	   HIGH 0   ' LED on  RB0 ----|>|---/\/\/----gnd
	ELSE
	   decideInterval = 600
	   LOW 0  ' LED off
	ENDIF
	pause 500
	GOTO   MAIN

	END
If your LED blinks on/off, it's working properly.