First of all, I would say that since the conref element only references that section (the section is not in the topic for real), it is not possible for the transformation to identify which parts should be filtered or not, especially if that section has no product attribute.
So maybe you could try the following:
For referencing, create product-related sections, not one section that contains only product-related <p> elements.
<section id="section_amd_sfj_znb" product="shown-product hidden-product">
<p product="shown-product">I want to show this paragraph</p>
<p product="hidden-product">I want to hide this paragraph</p>
It worked for me to conref this product-related section. If this doesn't work for you, you could also add a product attribute to the conref element, just in case. Our ditaval files are just like yours.