I was able to resolve with the following:
- Took both objects (catapult and arm) and removed the current collisions
- Created new simple collision boxes (capsules/spheres).
- Created physical materials to apply to all (base, arm, and ammo)
In the end the complex to simple collisions seemed to turn off the physics (you know the warning you get every time you even talk about collision?).
The arm no long breaks position and the ammo loads (nearly) properly