Dataflows behaving as if Enhanced Compute is off

Hi ChristopherKing ,

Thank you for reaching out to Microsoft Community.

I understand that you're experiencing unexpected behavior in Power BI Desktop when connecting to dataflows that have Enhanced Compute Engine explicitly enabled. These symptoms include:

In Power BI Desktop, tables from these dataflows show the default grid icon (Import mode), rather than the lightning bolt (DirectQuery-compatible).
Attempting DirectQuery results in the error:
"This step results in a query that is not supported in DirectQuery mode" even with minimal transformation steps Source + Navigation only.
Refresh logs show "Compute Engine: Cached", which implies Enhanced Compute is active, yet the experience doesn't reflect that.

Although Enhanced Compute is enabled, several other factors can prevent DirectQuery from becoming available or functioning as expected like Dataflow Configuration, Dataflow Size, Query Folding Limitations, Data Source Compatibility, etc.

Here are some settings and checks to resolve the issue:

Toggle Enhanced Compute Explicitly

Go to your dataflow settings.
Set Enhanced Compute to “Off”.
Refresh the dataflow.
Then, set it back to “On” (not "Optimize").
Refresh the dataflow again.

Test Minimal Setup

Create a new test dataflow with just one simple table.
Use no transformations (just Source > Navigation)
Enable Enhanced Compute.
Refresh the dataflow.
Then try connecting via Power BI Desktop and check if DirectQuery is available. If it works here, it confirms that transformations or data size in your Prod dataflow may be the cause.

Validate DirectQuery Eligibility

For the problematic Prod table:
Remove any non-foldable transformations.
Avoid calculated columns, merges, filters, or any custom logic.
Temporarily disable incremental refresh (if applied).
Validate folding using "View Native Query" in Power Query Editor.

Workspace & Capacity Settings Check

Ensure the workspace is in a Premium capacity.
Go to the Capacity Settings > Dataflows in Power BI Admin portal.
Confirm that Enhanced Compute is enabled at capacity level.

As noted here issue with enhanced compute engine settings for da... - Microsoft Fabric Community , Enhanced Compute set to "Optimize" instead of "On" may result in the system silently defaulting to Import mode.

Hope this helps
Warm regards
Chaithra E.