You are right, I did have "settle at" enabled, so maybe it did something like command PHD to "dither 0 pixels" which caused the PHD graph to report that it did drizzle.
The real problem is that I did indeed want to dither, but the mixed up options made it look like it did while it did not. Maybe add some kind of reminder that the combination of options may be a mistake? Maybe there is some valid use for that combination of options that I don't know about.