Support for Lambda tends to be limited in these forums since it's not freely available so we can't test with it.
Can you describe how you're making the CSS changes? Are you modifying files? If so, which ones? Some themes allow you to modify CSS within Moodle, for example in Boost there's the Raw SCSS field (under Site administration ▸ Appearance ▸ Themes ▸ Boost on the Advanced settings tab). This is a better way of managing CSS changes as this works with Moodle's caching.
As you say, Moodle combines CSS into a single minified file. This is held in the cache but if you've purged all caches that should cause this to be regenerated. You could delete (or rename or move) folders cache and localcache from Moodledata, these folders should get recreated if the Moodledata permissions are correct.
If something was previously working then stops working this is usually because something has changed. It may be worth reviewing the Config Changes report for changes around the time this problem started.
Moodle 3.9.1 is nearly a year behind on updates so your site is missing bug fixes including 28 security fixes.