After playing around with a few more things I’ve noticed that applying external wheel torques will also lock out to the same skid magnitude limit. Which now seems obvious since this is where the traction control toggles are set so I guess that helps narrow down the problem to the chaos wheels and not the engine sim as I’d incorrectly stated above.
I’ve yet to clone my project to 5.2 but I’ll give that a try and see if theres any changes in behaviour.