This is how I created instanced: https://answers.unrealengine.com/questions/486485/issues-with-actors-tags-in-bp.html
Basically I have 8 static meshes (columns/pillars) I manually placed on the level. They have material instance where master material has all the goodies you mentioned above checked.
Once I am satisfied with how everything looks, I drop in my ISM BP actor, which creates 8 instances of the columns with the same transforms as original meshes. I place that BP into 0 0 0 of the level so that instances match location exactly with original meshes. Then I click “hide original” option on my ISM BP and original meshes get hidden.
After that I rebuild lighting and deploy. When running on the device, 6 out of 8 instances appear pitch black. 2 out of 8 instances are missing. That’s what is shown on the video.