The problem still exists, but I got around it by using overlap events instead of hit events.
To recreate:
Create a vive character. Set up collisions as in the first image. (on a box used as a weapon)
Create another character. Set up collisions as in the second image. (on the capsule)
When the capsule moves, I can hit it. When the capsule stands still, I can’t. No hit events are fired.
If I simulate physics on the capsule while it stands still, I can hit it just fine.