Okay so an update here for my progress with 'There is no Cake.'
I literally went through on a new save and did EVERYTHING in story mode, challenges, multiverse madness, and then finally multiplayer. The very last thing I had to do was taunt with Quagmire, but still nothing. I was a bit frustrated at that point, but whatever. I accidentally hit 'Next Map' instead of Main Menu. I said to hell with it, played the map (still as Quagmire) and I had the second controller as Meg (kept player two as Meg throughout), shot Meg from up close and taunted once again, and the achievement unlocked.
Now, the only thing that was different about this taunt from the others was that I got the in game points for a taunt over a downed opponent. This may be how this particular one has to be achieved for the game to count it.
It's coming back...