Going through the Event Viewer I found this:

Application: TestApplication.exe Framework Version: v4.0.30319 Description: The process was terminated due to an unhandled exception. Exception Info: System.IndexOutOfRangeException at Telerik.WinControls.UI.RadPopupContainerForm.OnKeyDown(System.Windows.Forms.Keys) at Telerik.WinControls.UI.PopupManager.OnKeyDown(System.Windows.Forms.Message ByRef) at Telerik.WinControls.UI.PopupManager.Telerik.WinControls.IMessageListener.PreviewMessage(System.Windows.Forms.Message ByRef) at Telerik.WinControls.RadMessageFilter.NotifyGetMessageEvent(System.Windows.Forms.Message ByRef) at Telerik.WinControls.RadMessageFilter.GetMessageHookProc(Int32, IntPtr, IntPtr)

Create a RadForm application project.
On the form place a radPopupEditor.
Place a radPopupContainer on the form.
Place a multiline radTextBox on the radPopupContainer.
Set radPopupEditor1.Visible = false in the RadForm's constructor.
When you run, the editor is not visible, but the radPopupContainer is visible.

If you skip step 5, the editor is visible and the container is not visible until you click on the editor...as it should be.

If you have a program that later makes the editor visible, when you click the editor, the container will move from it's original location to under the editor.  Clicking the editor again hides the container, and the visibility of both seem to work correctly after that point.

Please refer to the attached sample project and gif file which illustrates the exact steps and obtained result.

Workaround: set the DropDownStyle property to DropDown.

NOTE: Shift+Tab should also navigate through the controls in a reversed order with enabled AutoCompleteMode.

See attached.

Use case: when RadPopupEditor is opened, the focus is sent to the popup control which handles all the pressed keys. It would be added public API which provides the possibility to plug into this keyboard handling and customize the behavior.

For example, when the popup is opened, pressing Escape, closes the popup. This functionality comes from the RadPopupContainerForm.OnKeyDown which behavior can't be overridden.

Currently, only the listener can be removed for a certain popup:

    Private Sub RadPopupEditor_PopupOpened(sender As Object, e As EventArgs)       PopupManager.Default.RemovePopup(Me.RadPopupEditor1.PopupEditorElement.PopupContainerForm)
    End Sub

 

UPDATE: The API should allow handling the mouse input as well and the developer should control whether the message will be managed further.

By using the following code snippet, RadPopupEditor needs to indicate focus similar to RadDropDownList with the same properties applied:

            this.radPopupEditor1.DropDownStyle = RadDropDownStyle.DropDownList;
            this.radPopupEditor1.TabStop = true;
            this.radPopupEditor1.AllowShowFocusCues = true;