Unfortunately the filtering does not work with virtualization and this limitation cannot be workarounded in the current state of the control. We are working on a new version of RadComboBox, that most probably will work as expected (we will have to see if this can be implemented at all), but it will be publicly available as a Beta after the Q1 2011 release in March.
In addition, the TextBox will not autocomplete when TextSearchMode=Contains. The matching item will be highlighted, though, and the user will be able to select it by pressing Enter or clicking the mouse. The autocomplete is limited because there is no way to make double selection in a TextBox, e.g. you cannot have both selected the first several characters and the last several characters in a TextBox.
All the best,
the Telerik team
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