I appreciate the details you shared here. Please find my answers below and let me know if you have any additional questions:
Is it intentional that test licenses only apply to the Development app, even when they are assigned from the Production → Monetization page? –> Yes, Test licenses only available for Development app.
If so, is there any supported way to test entitlements in the Production app before going live? –> Currently, since the app is not published, you cannot test the entitlements against the Production app.
If not intentional, is there something else I should be configuring to ensure production test licenses are applied correctly?
*–> Test licenses are intentionally not available in Production (they could be misused without purchasing the app). In order to test against in the Production version of the app, you can follow these steps:
Step 1: Submit the app for review and select: “I will activate the app once approved” option on the submit page.
Step 2: After passing our review process and once the app is published, search for your app on the Marketplace, follow the steps to purchase your app for any paid plan with a credit card. Once purchased, you can assign the licenses.
Step 3 - Validate the licenses against the Production webhook URL.*
One additional point to clarify:
The “Learn more” documentation mentions test license assignment under the Development tab. –> You are right, we are currently working on fixing this statement. Test licenses should be under the Local test tab in Development. This is planned to be fixed in our next release.
In the current Marketplace UI, test license assignment actually lives under the Production → Monetization page. –> Yes, this is about to be fixed in the next release as well.