Ben did you ever figure this out? I'm running into a similar issue (and yes, I did set automaticallyMergesChangesFromParent to true. I also am seeing some odd behavior where CloudKit just stops responding all together. I'm still trying to get to the bottom of what's going on. So far I've examined my device's logs when the issue is occurring and there are no CloudKit+CoreData entries in the log (there are normally tons when everything is working as expected). It seems to happen when I upgrade the app (via TestFlight) but I still haven't confirmed that. I can sometimes fix this by logging out and back into iCloud on my device, which is a huge pain. I don't think it's anything in my code, so curious as to if anyone else has run into this. To your point in the original question, would be nice to force this update and get some sort of error if it fails (so I at least know the syncing is having issues without hooking my device up to Xcode every time to verify the log messages are there)

For anyone stuck on this (as I was), my issue was that I did not change my imported framework in my extension from "embed and sign" to "do not embed". Changing this ensures everything builds but does not include the nested framework in the bundle which generates this error.

For iCloud Container Identifiers you have the name of your database and for iCloud Services just cloudKit? I have both of these set and have the same issue that you originally posted about, not reliable – sometimes it works, sometimes it doesn't. Curious if you have made any additional discoveries? Super frustrating!