There is a quality setting switch inside POM node. You can rewire it as suitable for your project.
I’m seeing this same behavior in Packaged builds in 4.15
If I call the r.materiallevel function, it seems to fix the shader and I can return to the higher quality levels.
I wonder if this is tied to the Enable Static Lighting switch in the game settings?
After much investigation I have found an issue with the command r.MaterialQualityLevel.
I use the sg.EffectsQuality scalability commands. I looked inside BaseScalability.ini inside the engine and ran each command trying to find the one which causes the POM render issue. I found that r.MaterialQualityLevel=1 is the issue.
When a packaged game has run r.MaterialQualityLevel=1 before loading into a level any materials with POM will not render at all.
And here are 2 materials which go blank with this setting:
Still occurring in 4.17.2.