This is a bug. The UI is recording your selection when you save the domain. The error is when the ui tries to display the domain details page, it is always showing that field as empty.
You can confirm that the value has been saved by making a request for the information about your domain in your browser. The URL pattern is
/server:port/svi-alert/domains/{domain-id}
You will get back a JSON string which should include something like
... ,"suppressQueueId":"home_for_suppressed_events", ...
I have created a defect in our internal tracking system on your behalf. As Michelle suggested in her reply, create a tech support track if you want to follow up with tech support on the fix. (reference VIPR-41146).