I have a gridview inside an update panel, which is inside a modal popup panel. When the gridview updates, if it is larger than the original size of the popup panel, the panel does not render quite right. If I scroll at all, the panel corrects itself. What can I do about this?

Thanks for the issue - I created work item 6276 for this. You can make the fix I outline there for yourself for now and that should do what you want:

Fix appears to be to add a call to "this._layout();" to the end of _partialUpdateEndRequest [in ModalPopupBehavior.js].

FYI: The work item has just been fixed and the fix will be included in a future Toolkit release.