Hi,
Sorry to hear you're facing this issue. Anything that involves manipulating the UVWs in RailClone, including box mapping, only works and maintains instancing when the object remains a RailClone object. This is because we are using the V-Ray API to implement those features at render time which isn't possible once the object is converted to native Max instances.
Since native instances have to be identical to one another, if it's not too high-poly you would need to collapse the mesh to an editable poly to bake in the UVW changes if you can't use RailClone.
Paul