I removed the player setting to stop custom movement so now the player seems to collide and react well.
The enemy still does not react to the collision, instead staying there like a brick during the collision.
UPDATE: I think I solved the issue. The AI pathfinding was causing it to continue moving along the found path during the collision, which overrides the physics behavior that would cause it to bounce. Stopping the enemy's movement along the AI path during collision seems to allow the physics behavior simulate a collision.