Sorry - I though everything was fine - but I just now noticed that assets don't appear to be being copied during the merge process. I'm using version 2.3.1, running through Mod Organizer 2.
I assumed (perhaps incorrectly) that enabling the option would result in the merge containing the meshes, textures, scripts and other assets of the mods being merged, but my result contains only the .esp and an empty scripts/source folder (along with the merge folder placed there by Merge Plugins, of course)
No errors appear in any of the logs contained in the merge folder. I read elsewhere that reverting to an older version of the mod helped with that - but the post I found was a couple years old. Besides, it's probably something at my end.