You are hoping the backslash in the expansion of ${chLine#?} will be treated as a literal backslash character. And, in the expansion of ${chLine} it is. But, in word in ${chLine%word} the backslash is an escape character. Since \# is treated as an escaped # in the pattern instead of the two character literal \#, there is no match and the string isn't removed from the expansion with the removal of a matching smallest suffix pattern.

This is one of the changes that was made to ksh88 behavior (that is handled differently in ksh93) while the POSIX shell standard was being developed.

I think this explains the difference you're seeing, but unless your script tests which version of ksh you're using and uses different code for the two cases, you may have trouble finding a common variable expansion that will get you what you want in both versions of the shell. Unfortunately, you can't use ${chLine:2} in ksh88 (but it gives you what you want in ksh93).