Dear respected Jeffrey Anderson2,
Good day! Thank you for posting to Microsoft Community. We are happy to offer any support.
As per your detailed description and attached screenshots, we understand your scenario and from our tests, it seems like we can reproduce the same behavior that the group forms can only with the greyed out Allow respondents to edit option.
In this situation, we are sorry to convey this can be a default design and kindly send feedbacks to the related Microsoft Forms product team and share your ideas about this to let us make a better user experience. See: Feedback Community (microsoft.com)
Appreciate your patience and understanding and thank you for your time and cooperation.
Sincerely,
Mia | Microsoft Moderator