I have bounce processing working fine but I am trying to track replies. Replies are sent using a VERP address and are being received in the correct mailbox as defined in the CiviMail Administer/CiviMail/Mail Accounts settings.
I run the Process Bounces job and I expect to see an entry in the activities for anyone who replies to the email but I only see the outgoing mail under the type BULK EMAIL. The replies are correctly being moved from the Inbox to the Processed folder that CiviCRM created.
Replies are being counted correctly in the report for the mailing but are not being added to the contacts' activities.
There is a setting under System Administration/CiviMail/CiviCRM Component Settings that seems to be in error. If it is checked, it disables VERP replies. Leaving it unchecked causes replies to use VERP. This seems to be a bug.
As I have access to the Postfix server, I was able to move the processed emails from the "Bouncer" mailbox to the Inbox of the "Activities" mailbox then run the fetch-activities job. This successfully processed the replies and inserted them in the activities table.