i've noticed the same issue usually in crucible matches that are laging. like if one guy on either team is lagging really bad it'll effect the burn proc.

Seeing how this is still an issue for me and the December update is due next month, I'm bumping this for relevance. I too am using Gambler's Dagger but from what I understand, it should only slow the cool down timer for the knives, not lower the chance of them working properly. Not sure what triggers this bug as it appears to be random. I hope they find a fix for it soon.

It's happened to me as well, but it's just a bug with it randomly. It'll burn for random periods of time or not even burn an enemy at all. Sometimes it applies to your melee itself.