I had exactly the same issue and have been working with Apple tech support all night! PROBLEM SOLVED!
Please try and follow the steps below:
- Back-up your iPhone;
- Go to your iTunes library and stat-rate one of your songs;
- Now, sync your phone again;
- Go back to Music setting under 'General' and see if 'Show Star rating' switch is there.
- Switch it on and you will see star-rating for individual songs in music.
Background INFO: Apple removed star rating in iOS 10, so literally all your star ratings were removed and set back to NONE. So, to initialize this function, you would need to 'wake it up' by adding star ratings again for your songs in iTunes.
Hope this helps.