This was indeed fixed. Fortunately one of my systems was the only one in the office that apparently exhibited this symptom. Cancelling from the insert synth dialog would appear to hang the UI.
So I managed to track it down and fix it. It was a bizarre side effect of some code calling LockWindowUpdate followed by Unlock. On my system this would leave the UI unresponsive after inserting or cancelling the insert. It would be unresponsive until I moved the mouse outside the app. Probably some weird bug or interaction with Windows on some systems that was stalling SONAR's message queue.
This lock operation was actually no longer required (its not recommended anymore) so I took it out and it solved the problem.