Hi Derek, I notice that you've set a min gap and min wall, the software will only use one or the other. What these parameters do is make modifications to the advanced mesh settings. Changes to those settings do not guarantee that the mesh will conform to your request because there are other controls that are used during the meshing process in addition to simple cell arrangement. These are covered in the flow simulation training, the meshing tutorial and also in the technical reference/solving engineering guides.
When it comes to local regions, it is possible that your local control will not be applied due to those same controls. IE, if your initial mesh is too coarse, it cannot improve the mesh without breaking those checks and balances.
Overall, there is a bit of art when it comes to meshing and best to be learnt under some guidance or spending some time trying out different settings and reviewing the documentation. I think you're also expecting the software to create a certain number of cells because you've made those entries, that also isn't the case. There is a lot that is going on in meshing and things aren't that straight forward.