Issue was due to Sublime Text 3 'atomic save' and Linux. Turning 'atomic save' off resolved the issue.
Specifically, add the following to your user perferences in ST3:
"atomic_save": false
and it should work properly.
Spent a lot of time troubleshooting this issue so if anyone has any further questions feel free to reach out. As a general rule, run guard with --debug to troubleshoot.