To duplicate the problem:
1) Set the campaign to use predictive dialing.
2) Set the Drop Timeout to a large value like 60.
3) Load a lead list that will only dial your own test phone number.
4) Login to VICIDIAL.
5) The predictive dialer will dial (1st lead) your test phone.
6) Press the "Hangup" button and WAIT at the disposition screen.
7) Wait for the next call (2nd lead) to come through on your test phone call.
When it rings, pick it up and immediately hang up before it could drop the call.
9) The 2nd lead's status will not change, nor will it be recorded as a drop.
The result is that the predictive dialer will incorrectly adjust the MAX_DIAL_LEVEL to dial more leads instead of fewer, depending on the campaign setup and current DIAL_LEVEL.