Well, this is not a bug. The feature is simply turned off. To enable it back on you need to fumble around in the camera settings.
Head over to the camera app and then click the gear icon to go into the camera settings. Here, under the Front Camera section you will see Ways to take pictures. Under that menu, you will find the Tap to take pictures option. Tap it to enable the feature. Now you should be able to use the entire screen as a shutter to take selfies. With Nougat, you just have the option to turn it off or on. It is a taste of preferences.