i faced the same issue (same result anyway)
I just switched to V3 Poweramp (technically: "alpha-build-703-play(full version)"), already had musixmatch installed.
Basically Poweramp doesnt seem to be able to call up musixmatch - i just get the "no lyrics tag found in the song" popup. regardless of whether i have the lyrics set to search tag and musixmatch, or musixmatch only. I tried uninstalling musixmatch entirely and reinstalling (at which point it updated to 220.127.116.11).Still no luck.
Note that musixmatch *does* seem to be able to see what Poweramp is doing (and find lyrics) if you have the (annoying) floating lyrics turned on, but i cant initiate the viewing of lyrics from within Poweramp.
In case it helps, im using an S7edge with android 7.0.