Confirmed that using Full Screen removes the controls, there's no count down and grays out the right-click options on the Microsoft Expression Encoder 4 Screen Capture tray icon. Using CTRL SHIFT + F11 to try to play and pause the recording, because recording has not started. Other CTRL SHIFT key combinations failed (including F1-F12 and Enter, Space Bar).
CTRL SHIFT + F4 allows you to choose the size menu at this point, and choose another size.
The work around is to use Current Screen option, which will select the entire screen which is equivalent Full Screen option, unless you have more than 1 monitor.
Hope this will help.