This is actually working correctly in 4.9, 4.10, 4.12 and 4.13. It was broken in 4.11 so this is an incorrect regression. See below for the information on intended behaviour, but a material instance used as a blendable will treat the base material as the 'default' state and intentionally blend in from that when entering a post process volume. UMaterialInterface::OverrideBlendableSettings() comments: // If the initial node is faded in partly we add the base material (it's assumed to be the neutral state, see docs) // and then blend in the material instance (it it's the base there is no need for that) https://docs.unrealengine.com/latest/INT/Engine/Rendering/PostProcessEffects/PostProcessMaterials/ All material instances properties are blended, no matter if the property checkbox is checked or not (in that case it blends the property from the parent).
When applying a Post Process Material Instance as a blendable element in a Post Process Volume with the blend radius set higher than 0, the post process will blend the Master Material's inputs with the Material Instance applied.
Yes, this issue doesn't occur in the binary of 4.11.2 - 2946394
RESULT: At the edge of the specified blend radius the master material's color overrides the material instances' color. (See attached screenshots)
EXPECTED: Only the material instances color blends and not the master material's color.
There's no existing public thread on this issue, so head over toAnswerHub just mention UE-32871 in the post.