With the "Redmond" UI theme selected, I get weird behaviour when viewing the the list of available themes using the "Window Manager Settings" utility. When the utility is started, the currently selected theme does not seem to be displayed. However, when you move your mouse over the themes that are displayed, the names switch to those that should be displayed. This only seems to happen when the currently selected window manager theme is far enough down the list to cause the scrollbar not to be at the top. I've created a flash video of this bug at http://www.zen84964.zen.co.uk/redmond-bug.html
This is not a bug with xfwm4, it's a problem between Xorg and gtk and compositing. If you disable compositing, the problem will go away. The problem arises because the the parent window is moved, since the height of the title changes. Do you run nvidia proprietary driver? I'm not seeing it that here with the open source nv driver.
I am using the proprietary driver. However, I tried disabling composite completely (both in Xfce and xorg.conf) and it made no difference. I also tried using the open source nv driver and still had the same problem.
Well, if disabling the compositor makes no difference, then it's definitely not a bug with xfwm4. The window manager is not involved with the rendering issues within the application themselves.