Your statement (1) above is exactly correct, and contains everything. I'm not sure that (2) adds anything.
So to summarize, here's what's going on:
(i) Enter the library browser
(ii) select a set from the "Select a Set from this Course" drop-down menu and click the "Edit Target Set" button
(iii) Select "gateway/quiz" from the "Assignment type" drop-down menu, and click "Save changes"
After carrying out (iii), (a) the web page instantly refreshes, listing
the "Assignment type" as "homework" (on the drop-down menu), and (b)
the mysql database correctly changes assignment_type to "gateway."
None of the "blanks" Mike mentions show up on the web page.
Hope this clarifies the behavior.
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