I'm losing my mind here after spending the past few hours upgrading and downgrading i think it is all the same between the different versions.

In Calendar if the default view is Monthly on my 9700 i would choose a day i had set an appt and it would go straight to the first appt in the day. With the 9900 it goes to the top of my calendar which starts at 5am.

Is this how it is with os 7.x on the 9900?

I think you are seeing the way it is. Mine does same thing. 9900/7.1.0.284.

I think I noticed this before myself. Apparently was dropped or lost or whatever somewhere along the way.
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Is there any OS for the 9900 which has this issue resolved?

Don't know. But if you've been searching and haven't found an answer, my guess is the answer is no. However, things disappear and then later reappear, so it wouldn't surprise me if the answer turns out to be yes. I just haven't seen it either way.
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I have searched but have not found any threads related to this issue. I guess people don't use their calendar as much as I thought

Different strokes. My thing one time was loss of the K shortcut to lock the device. Just disappeared with an OS upgrade, and it was a while before it returned with a still later OS version. That bugged the heck out me. The calendar thing? Meh. A minor irritation, to me.
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Ya coming from an old 7290 and never having left the BB platform you get comfortable with things that work and should work normal. When they take away features it just kills me. The problem is I'm on BES so everytime there is a new update i have to go to a company PC to sync and that is not as easy as BIS so i tend not to update when i find a working version without issues. Now it seems I have to constantly update till this works but from what I have gathered none of the OS 7.x have fixed this problem and I don't know if BB cares to fix it. It is a huge annoyance for me.

I think you need to select Agenda View and either select or deselect Show free time. Can't remember which one it is.

Does not work, but thanks

I have not seen what you're looking for on a 9900. I agree it makes little sense why it was overlooked, but it doesn't really bother me anymore.
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I use my calendar daily so now i have to use the space bar to get to some of those appointments and it is quite frustrating. I have downgraded OS on other BB devices just so that feature works. It is a shame so far none of the OS for the 9900 i have tried did not work.