Woocommerce order processing email subject not changing

The email template variables can only be used in the body of the emails. If you want to change the email titles/subject lines then you would need to use a the corresponding filter and add some custom code to a child themes functions.php file or via a custom plugin.

The WooCommerce documentation has a snippet for doing this: https://docs.woocommerce.com/document/change-email-subject-lines/

As an example for the processing order you would use:

add_filter( 'woocommerce_email_subject_customer_processing_order', 'change_processing_email_subject', 1, 2 );

function change_processing_email_subject( $subject, $order ) {
global $woocommerce;

$blogname = wp_specialchars_decode(get_option('blogname'), ENT_QUOTES);

$subject = sprintf( 'Hi %s, thanks for your order on %s', $order- 
>billing_first_name, $blogname );                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
return $subject;
}