I stumbled across the answer. The behavior is caused by the Perspective Workstation Launcher being open while the project is open in kiosk/full screen.
What I was doing was starting Perspective Workstation Launcher at startup, which would then automatically launch my project. I was messing around with the upload download buttons and ended up closing the Launcher when I alt+tabbed just to get it out of the way. I then noticed my dialogs behaved correctly.
So I set up a shortcut to launch my project directly and put that in my startup folder. Now my dialog boxes work like they're supposed to even on a fresh boot.