It’s incredibly frustrating that only the first letter is highlighted. I was guessing tons of SU… and SV… words, but only the S had visual feedback. Bug?
There is a bug in the calculation of the known prefix.
Suppose the target word is before tin, but after timorous. Midword only displays "ti" for the known prefix. But it should display "tim" - there is no string that could start with "tin..." but sort before the string "tin".
(Another bug is that if you take a hint that would reveal the entire word, the site doesn't display what the word was.)
It appears to highlight the letters that your guesses have narrowed it down to. For example if you had narrowed it down to after 'sudden' and before 'super', it would highlight 'su'.
It's a hint to tell you the word starts with "s", but since you didn't narrow it down to "su..." or "sv..." it's not giving you more hints.
Once you narrow it down further, say, "sub..." and "sun..." it'll highlight the known prefix "su"