After months of searching we finally determined the silly resolution.

A single quote was entered as the block title (a mistake by the way). The rendering engine inside the Xoops core did not escape the quotes like we expected and the single quote terminated the string so the names of the title never matched and the smarty comparison never worked. After all of that, the block was never displayed correctly.

The solution - fix the typo and everything displayed as expected.

I just realized I never shared our solution. Sorry for the LONG delay.