I see. You are using the Continuous Track. That track does not have the updater preference in the UI. However, the registry preferences still work.
However, what you want is the default, so either there's a bug or something odd with your environment/install. I guess I would try setting the registry manually and see if that works. If it doesn't work, I'd try an uninstall followed by the use of the AcroCleaner tool on labs. Reinstall and see if you still have the problem.
Ben