[ ... ] I tried various ways to fix the issue, one of them was
to removing the bad drive from the array and adding it back.
This forced all sectors to be re-written, and the problem went
away.

Lucky,

[ ... ] Now, the same issue happened again - another drive
developed a bad sector, and again, md `repair' action does not
fix it. [ ... ]

Thanks for letting us know things work as expected and MD RAID
has not developed psychic powers yet :-).

Similar reports happen now and then. Some people seem to develop
inflated expectations of what a RAID system can do, and how a
storage stack works. Perhaps some people imagine that "repair"
means "repair disk errors" rather than "repair RAID status".