I am having diffculty running the snippet you provided in my environment. Do you mind sending a running page / sample so we could test and determine the issue quickly.

Here you go.

Thank you for the sample page. We have successfully replicate the issue in our environment. The issue is caused because the zIndex of the content window is set lower than the shadow window. A quick workaround for this isssue would be to set a greater value for the zIndex of the content window after invoking the showDialog client side event. Here is the snipppet:

function msgbox(text, header) {

    //message box WebDialogBox1
    var activeWin = ISGetActiveWindow();

    var nameofwin = activeWin.Name;

    /* important: get existing instance if already existed to avoid duplicate instances */
    var dialogBox = ISGetObject(nameofwin);

    if (dialogBox == null) {

        //more logic processing
        
    }
    dialogBox.SetContentTemplate(text);
    dialogBox.Text = header;

    dialogBox.ShowDialog();

    dialogBox.SetZIndex(dialogBox.HostWindow.DialogBoxWindows[0].DropShadow.Element.style.zIndex + 5);
}

Hi, thank you for the fix. 

Will this be fixed in the next hot patch or is this z-index code provided the long term fix?

Thanks

I have reported this issue and the workaround to the developer. I will inform you if this fix will be included in the next hot patch. 

Edited 01/27/2010: The developer has agree to include the fix in the next hotfix

Hello,

I have added more code to my project to close a dialogbox and when I close the window, the shadow will not close.

I am attaching the source code for you to debug.

I figured it out

We have recently released WebUI Studio 2009 R2 Service Pack 1 which includes the fix for this issue. Please click here to read the official press release.

You could also read which fix or enchancement included in the latest build by visiting the support page and clicking the control name located on the Right Pane "Latest Builds".