What is Gmail's "All Mail" Folder? What is Archive Action for Gmail?
Gmail has a default Archive folder called All Mail, which already pre-archives all mails. An Archive command for Gmail essentially removed the mail from Inbox and that’s all (as it is already part of All Mail). This is Gmail specific behavior.
If you want to change the ‘Delete’ functionality so it would also Archive your emails instead of moving them to the Trash Folder, you can change the Folder Mapping:
Go to More | Various Account Settings | Choose your Gmail Account | Folder Management | Folder Mapping | Trash Folder | Choose [Gmail]All Mail