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Well it turns out I was able to probe the pad thru a via with a wire and it is already grounded! Perhaps that pad is grounded thru a ground pin or on the internal leadframe or something, maybe Altera wants it grounded for noise or power issues. I'm thinking that's not the reason it can't be detected via JTAG. I put in a support request to see if they know if that pad isn't grounded USB Blaster wont detect the chip on JTAG. I doubt I will get a meaningful response, the tech support people seem to be in india and just quote documentation, no real world experience with customers or contacts with people at altera to know this.
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According Altera specifications, it's clear that the exposed pad must be connected. There are also various user reports about complete function failure (e.g. no JTAG operation) with unconnected exposed pad. Of course there may be additional issues in your design, but it clearly looks like the missing ground connection is a sufficient failure condition.
In so far your support request seems to track mainly the academic problem why the function fails, although there's still some kind of ground connection. Did you also measure the resistance respectively voltage drop between both grounds, by the way? Quickly fixing the layout problem would be more target-aimed, I think.
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