Hope this helps why the statute appears to contradict itself:
Under the 1940 Act, if the mother of the child born abroad out of wedlock held United States citizenship and previously had resided in the country or in a United States possession, the child gained the mother’s nationality from birth, provided the child’s paternity was not established by legitimation or a court order.2 But if the father and not the mother held United States citizenship, then the child would qualify for United States citizenship only upon legitimation or adjudication of paternity during the child’s minority. Furthermore, the child generally had to live in the United States for five years before the age of 21. The same residency requirement applied to children born abroad to married couples with only one United States citizen parent, whether that parent was the mother or the father. Nationality Act of 1940, §§201, 205, 54 Stat. 1138—1140.3
Subsequent legislation retained the gender lines drawn in the 1940 Act. The Immigration and Nationality Act of 1952 made only one significant change regarding the citizenship of children born abroad out of wedlock. It removed the provision that a mother could pass on her nationality to her child only if the paternity of the child had not been established.4 Immigration and Nationality Act, §309, 66 Stat. 238—239. In 1986, however, Congress added further gender-based differentials. The Legislature that year permitted substitution of a written acknowledgment under oath or adjudication of paternity prior to age 18 in place of formal legitimation. To that extent, Congress eased access to citizenship by a child born abroad out of wedlock to a United States citizen father. At the same time, however, Congress imposed on such a child two further requirements: production of clear and convincing evidence of paternity, also a written statement from the father promising support until the child turned 18. The requirements for a child of a United States citizen mother remained the same; such a child obtained the mother’s nationality if the mother had resided in the United States or its territorial possessions for at least a year before the child’s birth. Act of Nov. 14, 1986, §13, 100 Stat. 3657, codified as amended at 8 U.S. C. §1409. No substantive change has been made since 1986 in the law governing citizenship of children born abroad out of wedlock.
http://www.law.cornell.edu/supct/html/96-1060.ZD.html
Interesting footnote to that case:
3. The provision granting citizenship to children born abroad out of wedlock applied retroactively; the provision granting citizenship to children born in wedlock did not. The 1934 Act, too, was nonretroactive. The net result was that a child born abroad out of wedlock to a United States citizen mother in 1933 or earlier had United States citizenship after the 1940 Act, but a child born in wedlock did not until 1994 when Congress enacted legislation making the 1934 Act retroactive. Pub. L. 103—416, Tit. I, §101(a)(2), 108 Stat. 4306, codified at 8 U.S.C. § 1401(h).