Dan,
Ok, if I understand, my project tab "Z Coordinate System" found when populate Output Coordinate System (see screen shot below), is the same as the "Vertical Parameter Button" you are referring ? If I am correct, my elevation values are not changing from feet to meters. I have an elevation, for example of 25.36', that value persists after the transformation (SC Nad83 Intl ft to WGS84 m). What else am I likely missing ?