Some companies are really dumb and only consider candidates with specific job titles on their resume. I've had recruiters from contract companies say "your experience is great but can we change your previous job title to X." Recruiter knows the client gets hung on job titles if its not exactly what they're looking for. In my experience i'll change previous job titles to fit the position i'm applying for, as most of my previous jobs I could've been titled 4-5 things.

I've seen this happen. Most companies cannot hire competent recruiters. Often recruiters have no technical background, and are unfamiliar with all but the buzzwords.

This trend will probably continue until someone decides to up recruiter pay and hire engineering background candidates for recruiting roles (if possible).

Did you try dropping the exact title from your resume for a more general description of the role?

Replace by Software Engineer. Problem solved!