Update #3:
So evidently objects are only “instanced” in the way we are wanting if they manage to make it into the ComponentInts array inside an object’s PCIP, which requires that you go through PCIP.CreateDefaultSubobject() to achieve that. This causes the destructor of the PCIP to instance the subobjects appropriately.
One thing I am thinking about doing is manually adding UObject properties marked as Instanced (or classes that are marked as DefaultToInstanced) to the ComponentInits list so that they will be initialized properly. I like this approach as it seems to be the least likely to cause problems down the road. PCIP’s are only instanced for the duration of the constructor, and as far as I can tell they don’t actually care if non-TSubobjectPtrs are in that array. This would require traversing the properties of a UClass from within the constructor of FPostConstructInitializeProperties and adding them to that array. We can’t really go through the current subobject system in PCIP because that requires the objects be uniquely named on line 2412 of Class.h.