I'm running a custom 1.7.10 modpack with Antique Atlas and a bunch of other mods, and despite the config setting being "B:auto_village_markers=true," the atlas does not create village markers. I can provide a full mod list if that is helpful, but the two main mods I would focus on first are Witchery and TerrainControl, since both change terrain generation.

I am using Forge 10.13.4.1614 and Antique Atlast 4.2.10.

These mods may change villages in such a way that the VillageWatcher class cannot see them. Do the builings on the minimap also disappear, or is only the marker missing?

The buildings on the minimap also disappear. It may not be possible to make them compatible.

Sorry for the super late response.
This sounds like a small issue that doesn't really break the gameplay. You can still place village markers manually.