I spent a couple more hours changing AStarPath settings and navmesh cut settings but couldn’t find one that made a difference. In this pic, the white line shows the path without any modifiers and the yellow one is with modifiers (funnel, smooth, startend, radius, and clamp-to-ground). This tells me that the problem is not with one of the modifiers. The problem is not as drastic in this pic, but the path is going to the side of the destination instead of going straight to it. I have seen other examples where the chosen path takes curves way behind the destination and then loops back 180 degrees.
Coincidentally, 7 hours before I posted this question, @AlManiak posted the same question here: Need help understanding Closest On Node Surface end point snapping . I can tell by the screenshot that he is using a navmesh cutter as well.
I hope this is something fixable because it’s important that my nav agents move towards an item that has a navmesh cut around it without looking like they’re drunk. 