It could be that the modem can still see the phone tower, but its handshake to create a 3G connection fails, which it then retries indefinitely.
That would be different to having no signal whatsoever, where modem wakes up, listens for a tower, concludes there’s nothing there and goes back to sleep again.
That would explain why this issue is only cropping up now that 3G is being turned off, and how this scenario was missed by engineers. They assumed there was either a tower they could communicate with, or nothing. They didn’t account for a perfectly good tower being available, advertising itself as a recognisable network, but refusing to handshake.