I tried this and it’s working perfectly for me. I even changed the modified report to the default in Method and tested generating the PDF. This worked perfectly as well.
After adding the Activity:WorkOrderInstructions field, you do need to save the template before it will be displayed in the preview section of Report Designer. You also need to make sure that you are using the custom template in Method. You can do this from a work order by selecting Activities… > Customize Templates and verifying that you have selected your custom template for Default Work Order Template (Print).
If you’re using a custom work order screen, you will also need to verify that you are using the correct field. It’s possible that the Activity:WorkOrderInstructions field was replaced. Also make sure that you are looking at a work order that has data in this field.
Once you have verified this, please post back here and let me know if you are still having this issue.