Huh...no these birds aren't crazy. First of all, the bugs are not UNDER the siding, but in between the sheets of laminate, chewing the wood. There are voids in there and they eat the wood making a nice crunching sound for the birds to hear. The birds then peck away to get the grub making the chewing noise. When the bugs become inactive, they birds will stop.
When they peck on a hunk of metal, (like my chimney covers) it makes alot of noise but the sound carries far and wide. This does two things....first it announces to all the cute females that king kong is in the neighborhood and wants a date. Secondly it tells all the other males to keep clear as this territory has been taken.
You can buy tree netting and suspend it from some hooks that will last all season long which will keep the birds off the siding. The netting is used to keep birds out of cherry trees and other fruit crops. It is thin as fish line and designed in squares. Once you hang it, the birds will stay away. But killing the bugs by spraying the siding with a good long duration bug killer will be much more effective in the long run. Kill the bugs, and the birds will most likely go away.
The netting costs about $15....which is about the same as fishline.
Notice that there are thousands if not millions of homes with the rough sawn siding but 95% of the time it is stained which deters bugs from getting in it. Most often the siding the birds prefer is natural, or has very little covering..preservative, thus allowing the bugs to find a way in. Bugs in...birds peck away.