I've followed your steps to the letter, but the HC's arent taking over on my end.
Long story short: it's in the CFG's, i see the HC's connect in game and slot themselves, but i dont see the load being taken off. Server is dedicated, HC's connect externally.
Three HC modules (HC1,HC2,HC3), Alive Required ai distri set to HC, yet in the init i get:
14:39:05 ALIVE AI Distributor exiting, no headless clients  or not server false
when the HC connects succesfully, i see this pop up in the log:
14:40:49 Setting invalid pitch 0.0000 for HC
No offloading. but HC is connected.
Found it. The hosted server had AutoInit enabled. Turn this off if you have it, then connect the HC's, then the (first) player(s). And go!
ALIVE AI Distributor switching group B Delta 2-3 to HC HC <-- it's working, but it's not dividing them between HC HC2 and HC3, just all to the first HC. What's going on there?