Just found the answer to this problem, which is very obscure. A USB device will not tether on the S7 if phone is in “wifi calling” mode. Not sure why.
I discovered this through troubleshooting the phone. I USB tethered the S7 to my macbook and the warning message came up “USB not active while wifi calling is enabled”, or something to that effect.
So, now it is working again with the phone app.
Still unsure why, after jamming with a lockit box and unplugging, the tentacles remained blinking three times rapidly, rather than normal single blink.