I've been trying to record the arp into an external sequencer, MPC Live, and came across this problem.
When set to local off + arp / seq midi transmit on, the PolyBrute's sequencer functions normally playing the PolyBrute / external modules,
but the arp does not play either the PolyBrute or external, also if you press hold, the light on the hold button just flickers and cannot be turned off without rebooting.
The only solution at the moment is to set it to local on, then record the arp with the external sequencer then switch to local off to play it back on the PolyBrute.
P.S.
I'm on the latest firmware.