1)

• Hide Rank in the first course and then do not hide it in the second
• Login as a Student
• Go to the second course and click Overview Report
• You will see Rank column with ALL ranks from all courses

I think that students should not see their ranks for the courses where it is set to be hidden.

2) Plus, there is an issue with admin settings. May be it is related, so I am putting it in one ticket.

• Go to Site Administration. Check Show Rank (make it default for installation)
• Go to the Course. Drop-down will say Hide(default) for the Overview report
• Login as a Student. You will see the rank.
• Go to the Course as a teacher and change drop-down to "strict" Hide
• Login as a Student. You will not see the rank