Perhaps a bit of necroposting, but to post my solution to keep anyone else from suffering as long as I did: The issue for me was Rustbound Magic. Removing that mod fixed the character reset bug.
I do not know WHY Rustbound magic was causing characters to reset on character creation in multiplayer, but it was. I couldn't find any logs that were triggering the issue, so if someone wants to look into this they'll have to do it mostly from scratch.
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