Can't type a custom select using site docs

[c-kirkeby]

I've spent a couple of days trying to figure out the types now, and maybe I'm just fundamentally misunderstanding something, but I've tried to follow the directions on for a custom multi-select. I'm also trying to cover the case where it's a single select but for the purposes of this we can assume that it's a multi-select. The docs state that the following should be the type signature for a custom onChange handler:

const onChange = (option: readonly Option[], actionMeta: ActionMeta<Option>) => {
   ...
}

I create a custom select as per the example in the docs:

function CustomSelect<
  Option,
  IsMulti extends boolean,
  Group extends GroupBase<Option> = GroupBase<Option>
>(props: Props<Option, IsMulti, Group>) {
  const onChange = (
    option: readonly Option[],
    actionMeta: ActionMeta<Option>
  ) => {
    props.onChange(option, actionMeta);
  };
  return <Select {...props} isMulti onChange={onChange} />;
}

But as you will be able to see here in my demo, this gets a type error when I then assign it to a custom select:

Type '(option: readonly Option[], actionMeta: ActionMeta<Option>) => void' is not assignable to type '(newValue: OnChangeValue<Option, IsMulti>, actionMeta: ActionMeta<Option>) => void'.

For some reason the type is (newValue: OnChangeValue<Option, IsMulti>, actionMeta: ActionMeta<Option>) => void instead of (option: readonly Option[], actionMeta: ActionMeta<Option>) => void as described in the docs and I don't understand why. I also get the following error when I assign isMulti:

Type 'boolean' is not assignable to type 'IsMulti'.
  'boolean' is assignable to the constraint of type 'IsMulti', but 'IsMulti' could be instantiated with a different subtype of constraint 'boolean'.