The conditions work for the content but not elsewhere if I insert it with the condition of “Entire Site”, with the exception of the CONTENT template I created.
I think if conditions are to work as expected, inserting them should work no matter where you insert a template if it meets the condition.
Again, in the case of the HERO template I created, if I insert it in any place other than the CONTENT template I made, the inserted template would display in the editor, in preview, but not the page when rendered. Other templates such as ones assigned to Header or Footer do work in the editor and the page.
Personally, I feel this is a bug and I think I will report it as such at this point.