I reviewed the image that you have attached. The element that you talk about is the snap preview element. In case you have enabled snapping, this element appears while you are dragging the selection element, so that is shows where the selection will be dropped. It should not always be smaller than the selection itself - it depends on the MinSelectionRange, MaxSelectionRange and the current intervals that the selection can snap into.
In case this information does not help you, please open a formal support ticket and send me a simple running project, with which you can reproduce the problem, together with a video, demonstrating the behavior you get.
the Telerik team
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