It took me this long to log in, but here goes.

https://forums.larian.com/ubbthreads.php?ubb=showflat&Number=944527#Post944527

I've experimented some more with this bug and cracked the code, so to speak. The invis does actually work, however, if you have any buffs at all active (guidance, temporary HP, etc) you will be KICKED OUT of the invis effect! That means the cape virtually is completely broken. I'm not sure why this happens, but this seems to be *one* major cause of trouble.