Commands look good to me.
Is this machine, by any chance, newer/running newer OS than the previous machines you've done this on?
In my experience anything with 'test' in the name can cause unexpected results. I've never tried it, but I wouldn't be surprised if things with 'dev' in the name do the same.
Try doing the same, but creating the user with the name 'boris' and call the directory 'cholo'... See if you get better results