Utility slot bug
I also have this issue with the flamethrower kit. I can’t recall off hand if it was on the bomb/grenade kit as well.
Either way, you’re hardly alone.
Work with conjured weapons too (just discovered it with lava axe). But conjured weapons can be “share” to exploit the bug for everyone.
At lvl 16 I was able to set all utility slots and elite (but I haven’t any elite at the moment).
Of course I submited a ticket after these tests.
Also works for certain NPC set weapons, Mortar’s and Sniper rifles are what I’ve tested and confirmed it on so far.
I picked up an Ascalonian Wine Bottle, had a similar result. Have also heard of people picking up buckets of water and having it happen.