Just a quick followup. Was able to RMA both boards and finally found the time to install them and test again. Made sure to use the latest stable releases for both firmware and DWC. All my problems seem to have been resolved. 
Thanks to everyone for their help!
@dc42 So I do have those, but they're too small for a single 13AWG wire I've been using for power, let alone two of them, so I used my own. The next smallest size wire I know I have is 20. Might have some 18 lurking around. What size wire is acceptable/is it designed for?
So I rewired the ground for the Duet/Duex5 to be per the instructions. The 20AWG wire was IMHO a bit too thin so I spliced the ground together. Basically, the two boards are connected via a single 13AWG wire and then I soldered in another 13AWG wire to connect to the power supply at a single point. I measured the resistance between the 3 connectors to verify a good connection and added some strain relief.
TL;DR: It follows the same pattern. Was able to home a couple of times and run the mesh bed scan via the PanelDue without problems, but I couldn't even get to homing the Y axis the first time without tripping the 20sec delay using DWC.
Any other suggestions/ideas?
@elmoret You're right. I miss-read the docs. What is the proper way? With the ferrules, I can't daisy-chain the grounds can I? Am I supposed to splice the wires together (solder & heat shrink?). Smaller wires and run two wires into the same ferrule?
@dc42 Connections are solid. Using ferrules on the Duet/Deux5 side and spade connectors on the power supply end. Wire is 13AWG silicone wire. Here's the wiring:
So trying that combo, and power cycled the printer (no USB connection) to start from a baseline.
From DWC:
First "home all" went perfectly
Second "home all" started fine... X & Y homed normally. Then things started to slow down after the first Z touch off
Third "home all" and there's a ~20 sec delay before each movement, starting immediately from pressing the button in DWC.
Tried home all from the paneldue immediately after the 3rd and it had the same problem.
Rebooted printer again.
From PanelDue:
Ran "home all" 3 times, all behaved correctly
Tried home all from DWC immediately after the 3rd paneldue test and it worked correctly three times in a row.
Then did a bunch of x/y/z moves via DWC. Not only did they move in the correct direction, but they were quick & responsive.
So it seems that as long as I do the homing first via the PanelDue then things are ok. But initial homing via DWC == problems.
Update: edited my config.g (reduced Z travel max) and reloaded. Then tried to re-home via the PanelDue which was immediately buggy. So it really really wants to start off from a hard reset.