This took me a lot of time to troubleshoot, but it’s actually a simple concept I wasn’t aware of.
In my lab, we typically use routers as end devices (PCs), and to set up the default gateway, I usually disable routing with the no ip routing command and then use ip default-gateway to setup default gateway.
One day, I tried setting the default gateway on a router and used ip default-gateway, it didn’t work!
Finally, I realised that ip default-gateway is only for device with routing disabled. When routing is enabled, you need to use ip route x.x.x.x to set the default gateway.