Hey all- I thought I followed up on this but I don’t see my follow up. I ended up making a Genius Bar appointment using my daughter’s iPad info. There was a step that asked me to specify what was wrong and one of the choices was “Accessories“ or “Peripherals” (can’t remember the exact wording.) I chose that. Her dad ended up taking her so I’m not sure if there were inspection or troubleshooting steps, but they completely replaced the pencil. So bottom line is I’m still not sure what the root cause of the problem is, but hopefully you can do the same and get a working pencil replacement!