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I added call back you suggested. From that call back I use NameOf(Parameters.Step) and assign it to global variable and read that variable from my sequence to get failed step name.
Perfect! This is exactly what I was looking for, because it is not a standard part of the step parameter container to the PostStepFailure. This doesn't make a lot of sense to me, anyone care to explain?
My question is as to why the NameOf function needs to be used in the first place rather than it being a parameter passed down such as Parameter.Step.NameOf. Only once I knew that the NameOf function works as a given for all containers in TestStand it made sense.