If current project has sub-projects, reporting an issue should not assume that the issue goes into the current (parent) project only. It should allow reporting into a sub-project. Probably the best way to handle it is with a project selection page, like when All Projects is selected, with selection list having the current project and its sub-projects.

(I've observed users starting with View Issues page with a parent project selected, showing issues in the parent project and its sub-projects, wanting to add an issue to the list in one of the sub-projects, clicking Report Issue, and being confused about what to do next, because the categories are wrong.)