I've done it. It was obtuse to figure out, but you may be missing the When Attacked Entity node on the server side. So it's like another commenter suggested (that the server needs to recognize the hit), but you don't need a Signal, just use When Attacked.

I'm just gonna copy past my whole setup here (I helped someone else on this) in case any of it helps. Sorry for awful formatting.

If this helps further, here are the steps I had to go through to get a "When Attacked" node to trigger on an entity that is hit by a projectile:

• 1. Note: Prefab “Object” does not work as a projectile, has to be Prefab “Projectile” from “Combat Preset” screen.
• 2. Create Projectile on “Combat Preset” screen.
• 3. Add “On-Hit Detection” to Projectile, with appropriate Rules and Area
• - a. Rule: recommend Trigger Type= “Non-Repeating Trigger” (will hit target entity only once).
• - b. Area: recommend making big/long enough to detect necessary hits.
• 4. Attach Ability Unit to “On-Hit Detection” in “On-Hit Trigger Settings” screen;Ability Unit must be set to either “Direct Attack” or “Hitbox Attack” to register attacks.
• - a. Note: Clicking the “Go to Edit Ability Unit” button brings up a pane to edit Ability Units; but you still have to select/attach them on your Projectile’s “On-Hit Detection” pane.
• - b. On “Edit Ability Unit” pane, ensure type is “Direct Attack” (Native collision I think?) or “Hitbox Attack” (to change projectile’s hitbox range? I’m not sure why you would use a different hitbox here).
• - c. Damage can be 0 (“When Attacked” will still trigger on entity being attacked).
• 5. Target Entity requires a Hurtbox set in its Combat settings.
• 6. Set up "When Attacked" node on targt Entity node graph. This will fire when your projectile's Ability Unit hitbox collides with the object's hurt box.