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DS3695 only receives data when ground is not connected

I'm testing an RS-485 link between microcontrollers using 2 DS3695s. The 2 Arduinos are powered from the same hub using USB, with one Arduino sending out numbers over the serial link and the other receiving the numbers and displaying them on a 7-segment LED. The receiving DS3695 has its Read Enable line permanently connected to ground.

The weird thing is that comms only work reliably when I disconnect the receiving DS3695's ground pin (pin 5). If I connect it and look on the scope at the comms lines, the positive line sits at 4.66V and changes to 2.14V when signalling, while the negative line sits at 0.90V and changes to 2.00V when signalling. Without the receiving chip ground connected, the positive line sits at 3.18V and changes between 4.66V and 0.96V when signalling, while the negative line sits at 2.36V and changes between 0.94V and 4.54V when signalling.

Any ideas? The Arduinos are connected to circuits on separate breadboards which are connected using a twisted pair about 25cm long.