I think I've made a semi breakthrough; I was stuck on trying to recompile SPCAMO stock SHP Icon111 from WW2; and I tried some other SHP files and they showed correctly:
Likewise, some old Warhammer 40K SHPs partially show up:
With this (helped by the very useful cross overlay) I think what's happening is that I've got the SHP compression code now mostly correct...
BUT somewhere along the way, the SHP header stuff is not being passed along correctly; and the SHP header stuff plays a big important part in the SHP file compression procedure; because it defines a bounding box of pixels that we compress and discard the rest (to save pixel space)