I'm beginning to think that the reason widgets don't show up with TestFlight distribution may not be a bug in TestFlight but a bug in Xcode beta 3. Has anyone tried to submit with Xcode beta 2?

OP, you are not alone. This is a TestFlight bug. See this thread: https://developer.apple.com/forums/thread/655393?page=1#623170022

I even set the policy to .never and the problem persists. Interestingly everything worked with TestFlight before Apple announced that now TestFlight supports HomeWidgets. 				let timeline = Timeline(entries: [entry], policy: .never)         completion(timeline)