That appears to be a bug in the combobox. When calculating the width of the combobox, the display of the label should be taken into consideration.
Just one last question: by any chance do you happen to have a RadFormDecorator on the page?
For this bug report I am awarding you some Telerik points, which you can see updated in your account profile.
the Telerik team
If you want to get updates on new releases, tips and tricks and sneak peeks at our product labs directly from the developers working on the RadControls for ASP.NET AJAX, subscribe to their blog feed