Edit #2: Ran across the problem again and conclude that it has to do with copy/pasting physics components from one node to another. Creating RigidBody/CollisionShape/Constraints works properly but not when you copy/paste them to try and save time (modifying the transformations won’t save).
Edit: Solved: apparently there is a bug somewhere with the editor and it’s not updating the transformation values of collision shapes after I set them. To force a refresh, click on the PhysicsWorld component of the root scene node.
Why does the models arm get offset? The collision mesh is in the right place: