I can see nothing wrong with the setup. I did see that you have a custom taxonomy ‘product_visibility’ that I cannot see attached to Products where you set an ‘Include’ in the form to ‘featured’ only, but I did try without that and no change.

As you are using WP Engine for hosting, can you edit the WordPress site wp-config.php file and add this line towards the start of the file (after the php tag line):

define('WPE_GOVERNOR', false);

Copy this from the forum post, and not the email, as email software will replace the quote marks with the wrong ones.

If that does not fix it, please get back to me, as I made need to escalate this to our developer, Ross.