On an Arduino UNO I usually use an AVRISP ISP but wanted to use the boot loader facility.
I selected "Burn Bootloader" from the VM menu. All went OK according to the verbose output.
Then I removed the ISP connection, unplugged the USB from the AVRISP  and plugged it into the UNO directly.
Then I selected Programmer as the STK500 but got a repeating time out message "avrdude: stk500v2_ReceiveMessage(): timeout"
After much experimenting I noticed that the "Always use Programmer for upload" was highlighted.
I deselected this and tried Build and Upload again but got the same message.
I then removed power from the UNO by unplugging the USB lead.
Then I tried uploading again and this time it worked.
OK reading your documentation about "Always use Programmer for upload" it says"If you have checked this menu item, then your uploads will be done via the programmer instead of a serial connection" but its directly below the Programmer selection implying its that programmer which will always be used.
It would be nice if the "Always use Programmer for upload" was disabled when the STK500 was selected. Not sure what can be done about the UNO requiring power off though.

Jim

From where I can Build & Upload OK, if I highlight the "Always use Programmer for upload" when I Build & Upload I then get the time-out message and cant see a way of stopping this repeating process.
I checked Device manager and it shows Arduino Uno (COM4)
I unplugged and re-plugged the serial port in and the time-out stopped.
I was then able to  Build & Upload normally.