The centreline and milepoint not being coincident is the crux of the issue. When I created and loaded the network it matches, and the uncalibrated network also matches the centreline. When I add the set of milepoints and apply updates, that's when the lines visually change to go through the points, rather than the points being on the line.
They ARE all within the M tolerance though (1mm), which is why I was asking if anyone has seen this particular issue before. I feel like it would be somewhat common experience if Roads and highways applies the points to anywhere within that tolerance.
This testing seems to have broken the centreline feature class, so I'll have to recreate it to test the cartographic realignment suggestion. Additionally no one else is doing any editing or anything in this environment.
It could potentially be related to how I bulk added the calibration points in the first place. Stay tuned for my upcoming question on that topic.