When I clicked the QuickZoom to the Underpayment Penalty Worksheet at the bottom of Form 2210 in Forms Mode I saw that the amount of 2020 refund applied to 2021 tax liability was applied partially for each of the first, second and third installments, listed as a payment with date 4/15/21. In each installment table the portion of the applied refund amount that is shown is just what's needed to meet the liability for that installment. The heading for each installment table shows an underpayment amount the same as on the 2210 Part III line 17 even though there is no underpayment due to the applied refund. The result for my return shows no penalty. This worksheet is only a "Keep for your records" form, it's not included with the filed return.
I went ahead and filed with the incorrect numbers on Form 2210, hoping that the IRS does the penalty calculation correctly to assess no penalty.
