Well, I'm slowly making progress. All my remaining issues are mostly regarding the wait list. I just created an issue... https://drupal.org/node/2158509
Basically the symptoms are:
Registration status is always "open" no matter how many are registered. When all users register, they are automatically placed on the wait list. Receive no wait list notification. Registration form drop down for State has one option "Waitlist" which is selected.
On one hand, I think it's time to start looking in the code, but then on the other hand this should work out of the box. Perplexing.