It worked fine for me, but just for the sake of confirming my steps:
- created a material with 3 parameters: Texture Object Parameter, Texture Parameter 2D and Texture Parameter Cube (the 3 types just to understand if it was happening with a particular one)
- set the textures inside the material for a default texture (engine built ones)
- placed a cube inside level
- created a instance and changed the default textures (all 3) using the start content textures and applied to the placed cube
- placed a second cube inside level
- duplicated the material instance by selecting the first instance at the content browser and typed Ctrl+W
- changed the textures for the 2nd instance (originally the ones 1st instance) to different ones using the start content textures and applied the copy to the second cube
- packaged for Windows 64bit (build configuration = Development)
Visually both are the same. I will upload the sample project in a bit.