I'm experiencing this same issue ...
Followed the Plailect guide to a T, I bought the legit Fieldrunners and downloaded Steel Diver from the eShop on the source, did System Transfer, used Fieldrunners to do the 10.4 NATIVE_FIRM downgrade, and I am at the point where you use Steel Diver as an entrypoint to Homebrew. If I insert the SD from the Source, it shows on the home screen, however if I use the Target's SD card, it does not.
I don't have any alternative method like OOT, Pokemon, etc.
Any help is much appreciated!