I think the problem may lie in your order of authentication as your authentication is looking for radius first and then local. This would be pretty normal as you will authenticate with your radius username but if you were not able to get to the radiu...
Yes same version is recommended but not same feature set, election only takes into account feature set if there is no winner on the previous steps 1 - 3. SDM template looks like it is only different on the 3750 - 12s.
