Cassie does spawn
seems to need snow or blizzard(seen both) and the level 40 morbols near the arena are the placeholder

It does seem like the theory that a closed instance that dies off is reopened instead of creating a new one is true though.
have personally seen the zone in and player count is less than 10 but climbing super fast and an NM is just pre-spawned with little time left
if that theory is true it would also explain why sometimes it takes forever to spawn if the window is still closed from a previous kill