UpdatePanel Causes Strange EventHandler Behavior for Dynamically Created Controls

There is one key point here that I failed to mention. When adding the UpdatePanel, of course Trace doesn't work, so instead of Tracing, I was throwing an exception. It turns out that it's not the UpdatePanel that is causing the problem, but rather the introduction of the throw exception.

Turns out this is a bug in the ScriptManager.

When you throw an exception, the ScriptManager is handling that by showing an alert box (otherwise you would never see the error, which would make it difficult to know something went wrong). If you write your own script manager, you can check the response header for the server status code and if it's not 200, you can do something. For these controls, they are taking the exception name and throwing it in an alert.

For some reason when we do this, we are not clearing out the exception and thus the sender object always points to the object that threw the exception. We are aware of this problem and are pursuing a potential bug fix for this issue.