I called them this morning about the issue. The person I talked to said that was unusual, but it didn't matter if you selected the "other" option as they can tell given the other info you provided, as you mentioned. However she relayed the info to their tech team and they fixed the issue for me, and the states were back under the drop down menu. It seems to happen when go to the submit tab and begin the process of submitting, at least that's what happened with me. I just submitted a few hours ago.
In regards to the questions, I answered them all since it wouldn't mark the program 100% complete and make it ready to submit. Some of them are fairly simple, asking if you've ever had disciplinary action or been convicted, etc. and that was it. LMU and DMU had essay questions.