I noticed something that MAY be impacting this. There are two “process test survey” actions – one on Page 4, one on the Test Results page. The one on the results page does not have the test/survey to process.
Page 4 also does not have a process question action like the other question pages do.
See if “fixing” either of these makes a difference.
Also, with the LMS, does the “display latest” refer to both the score AND the completion status? If you have a DEV server, it might be interesting to test it to see if it retains the “fail” even when you pass the “new” iteration.