Ok, so today was the day I decided that I should properly troubleshoot the external RAM issue in the Classic, since the new RAM board didn't work and gave the same issue as the old one.
First I dug out the BOMARC schematics for the classic. They are the best you'll find IMHO for these machines.
Then I pulled the mainboard and RAM card out and with my multimeter in continuity mode, quickly found that all the address lines were correctly connected, which was annoying since the error I was getting suggested an addressing issue.
Anyway, I continued on, quickly finding that pin 10 on the CASPAL (UL1) that senses the RAM board is installed was ok, as was pin 11 that indicates if SIMMS are installed on the ram board as well.
I carried on working through the connections to the socket, and noted that pins 21 and 23 of the CASPAL should connect to pins 5 & 6 of the RAM adapter socket respectively. There is also a 22R resistor connected in series in both lines, and this is where things got interesting.
Pin 21 to pin 5 was fine, measuring correctly, but pin 23 initially read over 300R. I dug out one of my donor boards and tested the same connections and both came out at 22R. So I traced the pin 23 to pin 6 connection, which turns out is on the bottom of the board and passes though a resistor marked R10.
Sure enough it was still reading high, until suddenly after some probing, it was reading a more normal 22R again. Time to break out the microscope!!
This is what I found:

- PXL_20230219_171545928~2.jpg (289.72 KiB) Viewed 1510 times
As you can see, there is a crack across the solder and edge of the resistor.
During desoldering, prior to a reflow you can clearly see here a chunk missing from the end of the resistor:

- PXL_20230219_172206264.jpg (334.84 KiB) Viewed 1510 times
And in the flux residue, just above the R from R10, there are the missing small chunks of resistor!!!
Happily, the resistor still reads in spec, so I re-soldered both ends, and the result is:

- PXL_20230219_173617303.jpg (172.27 KiB) Viewed 1510 times
Yep, we are fully running again with 4MB of RAM and the System 7 OS boots nicely from the internal HDD
I also tested configurations with and without SIMMS and it also works just fine. In addition, 2 different sets of SIMMs worked just fine.
I've left it running for a bit, make sure it survives a decent period of operation, then I'll pull the mainboard out and make sure any remaining flux residue is cleaned off before I reassemble.
I have been wondering if it's been damaged for some time, and if inserting the memory card caused flex enough to cause the damage to R10. It could even been that way from the factory, since if nobody ever used a RAM adapter, you'd never see this issue at all, and if all it ever had before was OS 6, then the RAM adapter isn't necessary.
I guess that we'll never know, but it is incredible how small components such as this can cause such mayhem, and it's good to know that following good old fashioned troubleshooting techniques can lead you to the root cause.
A happy Sunday indeed
