Component used: Room Persistence Library
Version used: 2.2.3
Devices/Android versions reproduced on: Pixel XL (API 26 - Emulator), Samsung Galaxy Tab A (API 28)

There seems to be an issue, with calling function from DAO, which is marked as @Transaction.
Issue emerges, while cancelling Job (Coroutines) which called the function.

Let's say, that we have simple function which:
1. Launches new coroutine
2. Inside this coroutine, we call function from DAO marked with @Transaction annotation

Then, if we would cancel this Job immediately after starting it, deadlock happens.
Every following function call, does not make place.

I've made sample project available here: https://github.com/lukaszreszetow/RoomTransactionsTest.

In there, you have two buttons. First one "Fetch user once" fetches user from the Database (using function called "getUser()").
Second button "Fetch user twice", calls this function twice.

As you can see in the sample code, we have mutual object, to which we assign latest Job.
In the beginning of every function call, we cancel previous Job and start new one.

Everything that is happening, is displayed in the TextView below buttons.

After pressing first button we can see that Job is loading data "Job 1 - Loading Data" for 3 seconds (there is a delay in DAO function) and then fetched data is displayed. In the logs we have:

D/MainActivity: Starting singular fetch
D/MainActivity: [main] Starting job 1
D/[main] Job 1: Getting user
D/UserDao: [arch_disk_io_2] getUserWithTransaction - start delay
D/UserDao: [arch_disk_io_2] getUserWithTransaction - after delay
D/[main] Job 1: Got user: User(uid=123, firstName=Adam)

If we later press the second button, TextView changes to "Job 3 - Loading data" (it's 3, because we called it twice) and nothing then changes. Data is not displayed (because it failed to fetch it), no error message is shown. In the logs we see:

D/MainActivity: Starting double fetch
D/MainActivity: [main] Starting job 2
D/[main] Job 2: Getting user
D/MainActivity: [main] Starting job 3
D/[main] Job 3: Getting user
E/[main] Job 2: Getting user cancelled
kotlinx.coroutines.JobCancellationException: StandaloneCoroutine was cancelled; job=StandaloneCoroutine{Cancelling}@86c7792

From now on, every call to this function is being frozen. For example next click on "Fetch user once" changes TextView message to "Job 4 - Loading data..." but nothing after that. Again in the logs:

D/MainActivity: Starting singular fetch
E/[main] Job 3: Getting user cancelled
kotlinx.coroutines.JobCancellationException: StandaloneCoroutine was cancelled; job=StandaloneCoroutine{Cancelling}@5cdea19
D/MainActivity: [main] Starting job 4
D/[main] Job 4: Getting user

As you can see in second and third case no logs from UsersDao are displayed. This means, that User's Dao function wasn't even called.

We can fix it now only by restarting the application.