In the (old) ConTeXT manual one finds for \underbar{} an example giving underlining of its whole argument. In contrast \underbars{} should not underline the spaces, as demonstrated by the example given.However, the actual behaviour seems just the opposite. Or has the role of these macros changed in the meantime? The wording (singular versus plural) indicates to me the opposite of the behaviour shown.
By the way, quoting breaks the underline flow!
A minimal example:
\starttext
\underbar{These words are done with \quote{underbar}}\crlf
\underbars{These words are done with \quote{underbars}}\crlf
\stoptext
result: