myoung34 After the upgrade, deleting the existing Jenkins EC2 plugin configuration (instances setup and cloud config) and re creating it seems to fix the problem.

You can follow the issue in https://issues.jenkins-ci.org/browse/JENKINS-47130

adoblas this is still an issue for me here.
I cant delete the plugin configuration and recreate, my configuration has a bunch of info in it re: labels/ami ids/etc.
Im going to stick with 1.36 until the issue is resolved, its not worth the effort to recreate my configuration for a broken update

myoung34 I completly understand. I'll try to find some time to fix this.

Saw this issue on 1.37 with core 2.73.3 also. Jenkins would launch a slave correctly, detect it's existence but never create a corresponding node for the created instance.

Removing the existing cloud configuration and re-entering it resolved the issue, with slaves launching as expected afterwards. 

After re-entering the configuration, it was noted that the new config.xml contained  <node>true</node> for each node (previously set to false)

I see the problem here. This was caused by the "node" field that was added to the SlaveTemplate https://github.com/jenkinsci/ec2-plugin/pull/232. The initial value of "note" was set to "true", allowing it to be provisioned normally. However, any serialized SlaveTemplates would (incorrectly) have the value of "false" which caused them to be ignored during the normal provisioning. The work of the PR did not consider this case.

I'm going to replace this by a different mechanism which more explicitly marks pipeline step created nodes so they can be ignored.