Good job of diagnosing the problem yourself! And thanks for reporting your results. I will put that in my bag of possibilities for when folks raise similar issues in the future. Normally, if the valve is not locked firmly in place, it will shoot up in height from the water pressure as soon as you turn the water on, making it very-obvious what is wrong. When you twist, the valve actually rises a smidge to lock in place. When you turn on the water, the pressure keeps it pressing upwards, so it is difficult to twist down to unlock. Sounds like yours was right on the cusp of locking, so it didn't shoot up and would seem to be firmly in place while the water was on.
PS That "contractor tab" used to be something that everyone was encouraged to install. It immobilizes the valve so mischevious folks can't fool with it, but it's a PITA to install and a bigger PITA to remove if you -- the person in charge -- want to adjust the water level. I think Korky found out that it wasn't really-truly necessary because as I mentioned above the design of the valve makes it very difficult to unlock while the water is turned on (you have to push down against the water pressure and then try to turn it). However, a lot of knowledgeable folks and pros (including my favorite local plumber) don't like walking away from the valve without being absolutely-certain that it's going to remain in the position that they left it, and would rebel if Korky discontinued providing the clip. So Korky continues to include the clip, but downplays its significance in the instructions now.
Also, I do it a little-differently than Korky recommends, because of the tendency of the valve to slide up a bit when you go to remove it in 3(b) before locking it, thus ruining your careful efforts to get the level just-right. Instead, after I adjust the valve to the height I want, I reach under the porcelain and just hold the shank of the valve with my hand from underneath while it is still sitting in the hole. Then I turn it to lock it. Then I pull it out of the toilet and install the clip if I am going to do so. (That's the reason the instructions originally called for it to be removed after setting the height; you have to have it out to more-easily install that clip.) If I'm not installing the clip, I leave it locked, and spin the plastic nut from underneath onto the threads lightly, confirm the position I want the valve to be in, and hand-tighten the nut the rest of the way. Or, again if not installing the clip, I will spin that plastic nut on lightly early in the process after I have put the valve into the hole, and thus can more-easily raise and lower the valve with one hand. I also often lock and unlock the valve not by turning the valve from the top, but by spinning the shank from below while holding the valve in the same position at the top. But you can only do that when the plastic nut is loose and the water is turned off.
Again, great job!
