Hey ,
To begin, I wanted to make sure that the IsServer node is behaving correctly, so I made a new project and ran through the tests:
With that in mind, the behavior seems to be working correctly.
Now, regarding your project. Can you change the SetupLobbyMenu to “Run on owning Client” and as “Reliable”, to see if that fixes your issue?
Thank you for submitting a bug report, however at this time we believe that the issue you are describing is not actually a bug with the Unreal Engine, and so we are not able to take any further action on this. If you still believe this may be a bug, please provide steps for us to reproduce the issue, and we will continue our investigation.