Well I feel silly now, and sorry for wasting your time. Turns out the problem is the character I was using for testing was over level 85.
Being my first time at this, I created a character and was playing around with GM commands, and set the character level to 90 (#level 90). After posting this information here, I figured I would try a new character that I hadn't given gear, AAs, and all sorts of other things (while getting familiar with things) to.
Turns out Mercs spawn no problem for any character level 1 - 85, but anything over that and they fail to spawn. This includes having a merc suspended, levelling over 85, then trying to unsuspend.
There is probably some information on this somewhere, but I never came across it. My bad.
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