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Your following conclusion
Our web API OData story lacks the client piece for now i.e a client side OData formatter. HttpClient and the json.net formatter are not supported with the ODataController and EntitySetController as there are some differences in how json.net serializes an object vs what the OData protocol expects. And, our ODataMediaTypeFormatter can only be used on the server. You have to use the WCF Data services client to talk to an web API OData service.
There is a codeplex issue open for adding client support. You could show your support by voting for it. You can also contribute this feature and send us a pull request.. We would be more than happy to review it and take it.
Your following conclusion
The only logical conclusion, proven by the FACTS, is that the Microsoft developed controller does NOT like (Album entity = null) the Microsoft developed HttpClient.PutAsJsonAsync() call.is right.
Our web API OData story lacks the client piece for now i.e a client side OData formatter. HttpClient and the json.net formatter are not supported with the ODataController and EntitySetController as there are some differences in how json.net serializes an object vs what the OData protocol expects. And, our ODataMediaTypeFormatter can only be used on the server. You have to use the WCF Data services client to talk to an web API OData service.
There is a codeplex issue open for adding client support. You could show your support by voting for it. You can also contribute this feature and send us a pull request.. We would be more than happy to review it and take it.