OK I found it.
The reason the comparison tool wasn't showing the error was because that section was the same as in the original but I had the line partially duplicated:

Code:
;------------------------------------------
Ancillary knight_templar
    Type Security
    Transferable  0 
    Image knight_chivalrous.tga
    ExcludedAncillaries knight_stjohn, knight_teutonic, knight_santiago ;don't want multiple knights with one character
    ExcludedAncillaries knight_templar
    ExcludeCultures mesoamerican
    Description knight_templar_desc
    EffectsDescription knight_templar_effects_desc
    Effect Chivalry  1 
    Effect Command  1 
    Effect PersonalSecurity  1

;------------------------------------------
Does make me wonder why CA decided to exclude the ancillary from itself in 1.2 but didn't in 1.1
Well, I removed it anyway and now it works fine :)