Seems to be working fine for me.
Try making a large change in the <zoomscale> and see if you notice it (I.e., try 5000 and 50).
Basically, this is the scale that it zooms/pans INto when you click on a result in the query widget. Once the "popup" comes up, the "Zoom to" button is part of the popup and does not change with the queryWidget.xml settings and zooms in 1/16th of the current map each time you click it (up to max zoom)and is not part of the QueryWidget.
If you are using tiled services, make sure the zoomscale you are setting is between your upper and lower LOD scales or it will not be able to zoom there.
Also, if you are already zoomed in, clicking on the result in the Querywidget will pan you to the new selection, but will not zoom "out" so would appear to be not working if you are already zoomed in (I.e., zooms in, but doesn't zoom out).
Try dragging your slider all the way down to zoom out as far as possible, then see if you notice the zoom function when you click on a returned feature.
R_
