So - tracked this down to a restriction in ImageMagick’s policy.xml file.
See this post over in the Omeka S forum for the solution.
Apparently it’s recommended to upgrade ImageMagick above 7.0.1-2 to plug the security concern the policy limit was implemented for: https://stackoverflow.com/a/52715220
I’m running ImageMagick 7.0.8-24. Thumbnails are looking good.