Bug or just me? Disappearing Add Options Label for dynamic dropdown

I spent hours figuring this out. Feels like a UX bug to me, but please correct me if I'm wrong.

Scenario 1: I have not yet completed the info for Define Options. I can see and select the Add Option Labels toggle.

Scenario 2: I've completed the info for Define Options. Exactly the same as Scenario 1. But now I cannot see or select the Add Options Toggle.

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