Hi Randall Kohltfarber,
A likely cause of the behavior you experience is that you are editing the original theme file, but not the one that is copied in the project directory.
Generally, when you add a theme as a resource, a local project copy is created from the original file. After this happens, the project only references that copy. I tried modifying the local copy, then Rebuilt the project and the changes were taken into consideration both at design and run-time.
If you have additional questions, do not hesitate to contact me.
All the best,
the Telerik team