Frequency capping not working in AJO Campaign (CDE) despite correct impression tracking

I am implementing frequency capping (e.g., max 2 impressions per user) for offers in AJO Campaign (CDE setup), but the capping is not being respected.

Setup:

• Offers fetched using decisioning.request
• Impressions tracked using decisioning.propositionDisplay 
• Offer-level capping configured
• Event dataset includes Experience Event – Proposition Interactions field group
• Both request and display events are visible and stitched to the profile in AEP

Impression Event Used:

alloy("sendEvent", {
    xdm: {
        eventType: "decisioning.propositionDisplay",
        _experience: {
            decisioning: {
                propositionEventType: {
                    display: 1
                },
                propositionAction: {
                    tokens: [tokensList]
                },
                propositions: window.latestPropositions
            }
        }
    }
});

Issue:

Even after the user reaches the defined cap, the same offer continues to be returned and rendered.

What I Have Verified:

• propositionDisplay event is firing correctly
• Tracking tokens are passed correctly
• Events are reaching AEP and stitched to profile
• Identity (ECID) is consistent

Need Help With:

I want to understand what could be missing in the implementation for frequency capping to work correctly in this setup.

• Are there additional requirements in Campaign (CDE) context?
• Is this implementation sufficient for impression-based capping?

Any guidance would be helpful.

Thanks!