OK, EagleJCS. It has something to do with the resolution of your screen. I had the same configuration as you had for everything (including the resolution of the screen) for test purposes. I managed (as noted above) to reproduce your problem.

Then I changed the screen resolution to 1280 x 1024 and I can see the whole of the smiley pop-up (including the resizing gizmo). It's OK with 1280 x 960, 1280 x 768, 1280 x 720 and 1280 x 600 as well but not with 1152 x 864 nor 1024 x 768.

I hope this helps.