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Yes - it is absolutely this. The "Tier 3" Steam package does NOT include the base game or any of the other Tier 1/2 content. This is what is actually in it: https://steamdb.info/sub/1034684/apps/
But you will also have keys for Tier 1 and Tier 2. You must activate the Tier 1 key if you do not already have TSW4 (and Tier 2 if you want that content too).
Here screenshot showing with arrows pointing at base game.
https://imgur.com/a/iQAFmhq
Now if this whole main issue what some people are facing then yes you have to activate base game 1st before DLC, if don't have the base game, it won't let you redeem DLC because you didn't have base game to begin with.
But for OP issue talked about just not showing up in library after redeeming.
This seems to be less PEBKAC and more a weird edge case where you can activate DLC without the base game activated.
Normally if you try to activate a DLC key without owning the base game on steam it will throw an error and not activate.
It basically like trying to make a grill cheese sandwich, you bought the cheese, the butter, but you completely forgot the base component which was the bread, can't make a grill cheese sandwich without the bread.