Split Federated Fine-tuning (SFF) is a promising paradigm for scaling Large Language Models (LLMs) by partitioning model depth between resource-constrained clients and a centralized server. While system incentives for throughput and privacy favor deep partitions, the impact of such configurations on model utility remains poorly understood. In this work, we identify and characterize the Depth-Performance Dilemma: the regime that maximizes system efficiency is precisely where fine-tuning quality collapses. Through a comprehensive audit across four model scales (GPT-2 to Llama-3-8B) and diverse benchmarks, we demonstrate that deeper partitions provide monotonic gains in throughput and privacy at the cost of catastrophic performance plateaus. We evaluate a suite of state-of-the-art federated adapter aggregation methods including AVG, STACK, SVD, and FREEZE, revealing that while these techniques are effective in standard Federated Learning, they fail to mitigate the artifacts unique to split architectures. Finally, we provide a mechanistic diagnosis for this failure, tracing the collapse to the near-isometric topology of Transformers, which allows aggregation noise to propagate without attenuation until it triggers Attention Collapse in the server partition. Our findings challenge the prevailing assumption that partition depth is a utility-neutral tuning knob and provide a structural foundation for stable distributed LLM fine-tuning.
A bfloat16 transformer can train normally for many steps and then collapse abruptly. Distinct low-precision errors can trigger the same failure, leaving unclear whether each source needs its own repair or one shared route can be blocked. We isolate a reproduced GPT-2-class collapse to the streaming-softmax accumulator, where fp32 accumulation repairs it, and use the fault as an assay for moving controlled errors across sources. Errors placed outside attention still drive the same query-key (QK) spectral runaway, while correcting only QK keeps training stable with the source fault active. This source-channel dissociation shows that fault source is not failure channel. It holds across the tested architectures and scales and reproduces on a second GPU architecture. A causal probe projects each update off the current QK weights' leading three singular directions: the query projection's largest singular value stays at 11.1, whereas removing equal energy elsewhere leaves it at 237. The QK channel therefore drives the early runaway rather than merely tracking it. Entry depends on temporal sign-coherence across steps, not aggregate deviation. QK-Guard closes the channel with a dormant controller that switches on parameter-free QK normalization when attention-logit saturation begins. It contains every tested runaway and matches always-on QK normalization over 60k steps, while non-QK actions at the same trigger fail. The results support intervention at the shared QK locus rather than separate repair at each fault source.