Normally when you refresh a section you don't want to lose any changes that you have made to the screen e.g. text entered into text inputs, checkbox / radio button selections etc.  So when the refresh is performed the values are posted to the clipboard so that when the section refreshes you do not lose any data.

If you check your radio button and then look at the data on the clipboard you will see that although on screen the row is selected the value of pySelected on the clipboard for that data row is still false.  When the section refreshes the pySelected value is set to true on the clipboard based on your selection.

If you check the "Disable submit on refresh" option then all the data gets refreshed from the clipboard without posting it first, so any changes on screen are lost.  In this case you lose the radio button selection.

Note that you will also lose any other non posted values that have been entered / selected on the same section so you need to consider the design carefully.