I linked to some forums below the video as well, as there seem to be quite a few workarounds for midi echo, depending on which version of Logic you're using etc. Unfortunately doesn't seem to be a "midi echo"-box/button that works in the preferred and most logical way (ie echo/through off, but still playing back already recorded events via midi out).
Even if the sequencer record bug is sorted with a newer firmware, I generally advice against using synths with local off/midi echo on (although it can also have advantages in some cases, as I noted earlier), mostly because it loads synths and systems with "unnecessary" midi information. If you have several synths connected via the synths "midi through" jacks, (and even if one doesn't, perhaps one day you'll suddenly need to, in a live setting for instance) I'd certainly recommend against it. It can also introduce lag, and some synths are not happy with sending lots of information and simultaneously receiving lots of information. So there is one less thing to worry about and to eventually troubleshoot, when something strange happens, like synths freezing, lagging, or in other ways behaving strangely, etc...
You should probably update your OS though... I'm on 1.1.4.5, the latest official release. I'm missing out on some features, but it's a very stable version.