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While a Recycler is in operation with scrap as its ingredient with a belt in front of it constantly moving out items, items don't stack correctly and you rarely see it stack items.
From what I have seen I think this is caused by the output priority being really bad for scrap.

Hello, thank you for your report! I must admit I didn't expect the result order to matter as in the tooltip it doesn't, but I didn't think of the ordering in the outputs resulting in better or worse belt stacking.

I guess you are refering to this mod https://mods.factorio.com/mod/better-scrap-stacking

I have basically done that, maybe with some slight differences but the same thing in principle.

Hope that addresses your concerns.

Resolved for 2.0.30

Thank you!

v