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Host name not being set in client

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I suspect this may be a misunderstanding on my part, and hoping someone can set me straight.

In Merlin version 386.11 on an RT-AC68U, I am trying to set a hostname on a client via LAN -> DHCP Server.

Under "Host Name (Optional)", I have filled in "testhost". What I expected was that after this client gets a DHCP address, I could type "hostname" and it would give me "testhost". But instead, it gives me the computer name set under Windows.

Also, I ran Wireshark to capture the DHCP, and I thought that if the host name was set I would see Option 12 (host name) sent to the client. I didn't see any option 12 in the server to client direction -- though I did see option 12 in the client to server direction (with the Windows name).

Am I misunderstanding how this should work? Or is there additional configuration I need to do for it to work as I expect?
The "Host Name (Optional)" field inserts the name in the router's DNS server. So if you issued nslookup testhost it should return the associated IP address, assuming your router is at

According to the following (old) post from Simon Kelley dnsmasq will not send option 12 data unless the client requests it. I can't think of a device I used that ever did that. Usually (for example a PC) it's the other way around with the client telling the server what it's host name is so that it can be put in DNS.

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