I havent found a fix but I did write a script that is a workaround for the issue until it is fixed. It seems like the issue is when the drive is first mapped. If you disconnect and reconnect and it maps it a second time the label is correct. So I wrote the following script to unmap the drive that I mapped via the registry key and then remap it again. Just replace Z with the drive letter that "Network Drive" is labeled (Usually Z is default for the first drive mapped) and replace G with the drive letter you are trying to map from the client machine in the registry key
Option Explicit
WScript.Sleep(5000)
Dim objNetwork, objShell, objUNC
Dim Network
Set Network = CreateObject("Wscript.network")
on error resume next
Network.RemoveNetworkDrive "Z:", True, True
Network.MapNetworkDrive "G:", "\\tsclient\G" ,true