The most likely explanation is that you’ve either created the preset “Flac / 44100 / level 5" with an actual sample rate set to 96kHz, or edited an existing one. Click the icon that looks like a filing cabinet to the right of where it says “Flac / 44100 / level 5", select “Edit” to bring up the “Audio File Format” dialog, and have a look to see what’s set as the sample rate.
Presets remain well beyond the scope of my - as yet - very limited Wavelab skills; but even if that were the case I would still like to see a situation where the actual settings are reflected in that message box, regardless of where they come from!
However, judging by the absence of an ‘official’ response I am guessing this is a known issue.
Your post says “WaveLab Elements 7”, and I’ve just had a quick look at WE7 on my laptop and it doesn’t seem to have FLAC support … are you sure these got installed with your version (or maybe I need to update mine).
BTW, if you need an “official” response you should register on MySteinberg if you haven’t already done so and log the issue with Steinberg support; this is just a user-to-user self-help forum (although “the great one” does very often answer posts himself!).
But if you haven’t FLAC support on your machines your could always try installing the package here http://flac.sourceforge.net/download.html and see whether the option appears.