Hey DougR,
I noticed the same issue in our environment as well. --> Elastic-Agent autodiscovery for Kubernetes pod logs not working after upgrading to 8.6.x
So I think we both came across the same problem. Good to know it's nothing that just occured in our environment. Our configs look quite similar.
In my case the same agent policy works fine with Elastic Agent 8.5.3. Therefore I'm currently thinking it's a bug in the new version. Would be nice if somebody could confirm, if it's a bug and not a config error.