I mean, it behaves something akin to a flag
That's the thing. In games, flags aren't (with very few exceptions) unraised. Once you trigger/raise them, they stay raised. Think of it like semaphores in real life. If someone sees you raising a flag and then set it down, their idea is not that it was raised but then you changed your mind. It's that the signal is raised and the appropriate action needs to be taken. (By the way, semaphores are where the idea of flags in computing came from.) Not only that, the conditions determine whether not a flag is raised. Like let's take the original Sonic 2 bonus level for example (that half pipe thing). You have to get x amount of rings at the end of the level. Only then do you get the chaos emerald. You can get above the threshold, but then lose enough to be below the threshold before the end of the level to not get the chaos emerald. Once you have said chaos emerald, you can't lose it. The ring x amounts are the threshold, the chaos emerald is the flag.
since that dialogue is required to be checked regardless of your approval with her in order to get that condition. It's just that it also requires said approval in order to activate and stay active.
Is that more or less correct?
Technically, but there's an asterisk for that.
That's actually not what that code is saying. The full code is here:
Or is the dialogue choice not required at all?
Seems to be needed since this is choice 1
In short. Flags are usually (with very, very, VERY few exceptions) things that are raised once and never un-raised. Points for thresholds move up and down quite freely.