We have implemented new functionality in the RadDropDownTree in order to handle the cases with the RadGrid. I am sending you a project with an internal build that shows how to do it. The setters of the SelectedText/Value properties will come officially with Q2.2013. In case that the sample does not resolve your issue, please send me a runnable project that reproduces the behavior that you described below for a local test.
the Telerik team
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