When no user-created animation controller is provided for the FX playable layer, animations on a user-created Gesture playable layer fail to animate properly in-game (though they work in-editor). Simply adding a completely empty animation controller to the FX playable layer slot fixes this issue. This suggests that the client-provided controller for the FX playable layer is interfering with the Gesture playable layer in some manner.
The debug menu shows the layer in the correct state and with the correct layer weight, but it does not animate until an FX player layer is provided by the user rather than the client.
I have created a sample project based on the current avatars SDK to showcase this issue. It includes two copies of a minimally configured avatar in the scene TestScene -- one labeled working, and one labeled as broken. The only difference between these two is the empty FX layer defined on the avatar descriptor for one but not the other. The animation in question is some very noticeable rapid ear movements.