The current behavior of the overflow button mimics VS2005 behavior, which however is deferent than IE7. Now that we think of it, our approach may not be the most usable one, and end users may expect the tabstrip to scroll to the selected tab.
We will consider adding support for scrolling into view in a future release. Currently there is no workaround I could suggest for preventing this behavior.
Thank you for bringing this to our attention.
the Telerik team