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Why is the deposit item showing up as a product?

An additional Shopify product is created that we call the ‘deposit product’. This is needed so PreProduct can charge partial amounts through Shopify. It doesn’t need to be in any of your Shopify collections though so feel free to remove it, as it is dynamically loaded into the cart when it’s needed.

The product that you listed in PreProduct is still the star of the show and the one that collects pre-orders/is-customer-facing.