We have the same issue using ArcGIS Runtime SDK for .NET v10.2.7 and dynamic map services published in ArcGIS Server v10.5. The polygon layers that have a transparency value will display with muted colors but do not have any transparency. I have verified that the transparency value is saved with the map service by browsing the map service Uri and looking at the Drawing Info properties (see below).
Layer: Feeder Boundaries (ID: 104)
Name: Feeder Boundaries
Display Field: FEEDERNAME
Type: Feature Layer
Geometry Type: esriGeometryPolygon
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Drawing Info:
Renderer:Unique Value Renderer:
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Transparency: 50
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Strangely, the same MXD used to publish the map service in ArcGIS Server will display the transparency correctly when shared as an MPK using a local file geodatabase as the data source. I sure hope someone has the solution to this problem.