A quick update with some better pictures. I put everything back together and the hub is worse now that when I serviced it. Slowly spinning the wheel backwards I can definitely tell something is wrong. The ratcheting noise alternates from light and quiet to heavy and loud throughout the rotation. The pawls do engage although I haven't taken them back out on a proper ride yet.
The pictures show how deep the gouges are in the freehub body so something has gone pretty wrong. I'm hoping freehub body has taken the brunt of the damage and the teeth in the hub are unscathed.
From the part numbers on the freehub it looks like this is OEMed from Chosen hubs. The only reviews for Chosen I found were in mountain bike forums and someone had about the same experience. I saw one review that said that the bearings were undersized which led to the axle flexing which stripped out the ratchets. Sounds like that could be the culprit for me.
I've emailed the wheel vendor with pictures and am waiting to hear back from them.
