Following up on this after additional research, this seems to be a very common problem with 3d systems. Random links related to Unity and Autodesk:
The problems in the links is specifically that child meshes distort when rotated when the parent has a non-uniform scale. The solution appears to be equivalent to “bake vertices.” This may workable in most cases.
If parent instances can be defined as uniformly scaled from an initial non-uniformly scaled “reference,” then the solution is to bake the initial non-uniform scale into the reference parent.
If the vertices of the parent need to remain unmodified, the solution may be to insert a transform node between parent and child with the inverse non-uniform scaling of the parent. This makes it more difficult to place the child relative to a specific point on the parent because the position of the child is no longer in the local space of the original parent. I think the workaround in that case is to assign position of the child with the desired position inverse transformed by the transformNode local matrix.
Does this indicate there is a use case for utility functions making this workaround easier to impement?