I think you're pretty much on the money here.

With most Compaq's, the charging circuit and the battery itself have embedded microcontrollers and sometimes you have to go through a process called 'characterisation' to get them both on the same page. This process involves a 24-hour charge followed by a full discharge with no power management enabled so that the machine dies (obviously best done in DOS).

It's worth checking for firmware updates from the mfr just in case they 'silently' update the microcontroller ROM too.