Hello Irene,
I might be experiencing a similar issue with payUpFront introductory offers. Eligibility is checked correctly.
In my case the payUpFront introductory offer is not working when the price of the introductory offer is higher than the standard recurring price. E.g., $29.99 for the first year, then $19.99 per year. The subscription is approved on the App Store. In all other cases the native payment screen works as expected, showing the introductory price or free trial period. Hence, when changing the introductory price to be lower than $19.99 per year, the troublesome subscription works and its introductory price is shown in the native purchase screen (both on the live store as well as on the on-device sandbox).
Perhaps in your case you set a higher introductory price as well? Then this might be the reason of the issue. According to my understanding, the price of a payUpFront introductory offer can both be higher or lower than the standard recurring price. App Store Connect also does not trigger an error or warning when setting such price structure. PayAsYouGo offers on the other hand need to have a discounted price and App Store Connect enforces this.
Is my understanding correct, or are payUpFront offers also limited to having a lower price than the standard recurring price?
Thank you for your help!