Just to confirm I had this exact same issue. I upgraded Fences to new version.

Wallpaper engine stopped displaying wallpapers at all (not even application based ones)

I tried reinstalling Wallpaper engine (did not fix)

I decided to roll back to previous version of Fences and it solved the problem perfectly.

If you use Wallpaper Engine do not use the current version of Fences it will break your setup.

To the developer please realize Wallpaper Engine and Fences are a common custom desktop combination. Ensuring these two software's work together is important going forward.

I have been using fence for a while now and to find out that this issue is still not working with wallpaper engine is a huge problem.  I know that yes stardock does offer a same kind of program but with out a doubt that wallpaper engine is a superior piece of software.  The one thing that deskscape doesnt have is a huge community that develops new and creative wallpapers.  So I have unistalled fences till this issue is solve.  That and most of the stardock software can run in windows 11 just cant open it for the setting to adjust things.  Hope to find a patch or something that fixes this issue.  

Hello,

Just an FYI that Fences 3.12 Beta was released today.

For all the details, please see:

https://forums.stardock.com/506115

We are very much looking forward to your feedback there.

Thanks,

AzDude
Stardock Community Assistant