Thanks for that. The flowchart looks good. Based on what I see in the flowchart, the only thing that I can think of that would be causing the video to stop would be an override on the button in m7 that links to the feature timeline.
I know you said that the overrides were all "Not Set", but could you please double check that one button?
If it's Not Set as well, then I recommend deleting the feature timeline completely; saving, closing and re-opening your project; going to Edit>Preferences>Media and cleaning the media cache database; then re-creating the feature timeline, giving it a new name in the process. It's possible Encore has gotten confused somewhere along the way.
-Jeff
The Focal Easy Guide to Adobe Encore DVD 2.0