I want to keep the cats penned in around my crashed rocket ship shrine, but with this setting they can walk right through just about anything (including walls and fences). Is that intended?

That's not intended. I'll look into it.

Ok I figured it out and pushed a quick fix. However, it seems like getting cats to go through gates if the "no player collision" setting is enabled is challenging, since vanilla gates only let through objects that are on the player or train layer, and that setting moves the cat off the player level.

I experimented with adjusting vanilla gates, but this had unintended for other mods. I might add in a "allow gates to still work on cats even if player collision is off setting" with a warning that this might have unexpected consequences for letting other things through gates though.

I can't speak for anyone else but I would prefer if gates did not respond to proximity from a cat. I'll try the update soon :)