Okay, apparently it is related to the editor or infinity chests.. I just tried using the /cheat all command in game, and now the augmentor is working properly. It's upgrading iron plates from normal to uncommon every time. So the editor and infinity chest versions of the augmentor are bugged out somehow? Would make sense, as I first noticed it when I was using the editor and infinity chests to build things.
Seems when I place the augmentor using Editor or Infinity chests, it doesn't work, but if I craft one normally it does. Bizarre bug.
Here are the exact steps I've taken to reproduce the bug.
Start a new game, completely default settings. Immediately use the /editor command twice, since the first usage prompts a warning.
Use the editor to spawn an infinity chest then leave the editor.
Use the infinity chest to spawn the augmentor, a substation, an electric energy interface (cheated infinite energy, same tab as infinity chest) some steel chests, some bulk inserters and a stack of iron plates.
Build the set up from the screen shots
Failure
Seems actually crafting the augmentor normally does in fact have it work, and looking at the debug tooltip info they seem to be the exact same augmentor either way. So it's super weird that using the /editor command breaks the augmentor.