From the TSAPI Programmers Guide, error ACSERR_SSL_INIT_FAILED (-14) is described as:
This return value indicates that a secure connection could not be opened because there was a problem initializing the OpenSSL library.
My reading of this is that the attempt may have failed even before the client tried to connect to the server. In this case, one of the changes you made has actually made your problem worse.
If I were trying to debug this, I think I would try the following two things:
1. Get a Wireshark trace on the client. Use it to check:
a. Is the client even trying to connect to the server
b. Does the client request a certificate
c. What certificate does the server send
d. What error does the client generate
2. Install the openSSL toolkit on the client and use its tools to test the connection and certificate. You can get more information on openSSL at https://www.openssl.org/