Hi brucse,
I assume that the weird behavior with the undefined option is a result of angulars magic. There is a issue currently open to fix the selection behavior for embedded forms: https://app.camunda.com/jira/browse/CAM-4289
In the meantime, you could try to get around the angular integration by managing the select field yourself: https://docs.camunda.org/manual/7.4/reference/embedded-forms/javascript/lifecycle/#submitting-additional-variables
Cheers
Sebastian