Grammatically, 1.5 donut is wrong and 1.5 donuts is correct. So, in this case "1.66~ dozens" (because 20 / 12 = 1.66~) is pedantically correct.
(...But logically and intuitively everything I just said is extremely stupid because by that logic 12.01 counts as "dozens" and that's ridiculous, so your complaint is absolutely correct and I agree with you 100%)