go to Documents\EA Games\Ultima Online Stygian Abyss\User Data\<your account name>\<shard name>
and remove the file with your character name (put it somewhere you can restore it if you need it again), then start the game and see if still happens...
Sadly the 'default' UI you get when you delete the user data file and reopen the character is NOTHING like I have my characters set up. It would take me hours to redo my characters template. Especially this one who has 240 macros on it. The macros are not the cause of it tho as my other chars are also experiencing the same problem.
That being said, the details of my chars templates for containers are:
toggle container contents info (off)
default (grid)
default corpse view (grid)
default player vendor view (freeform)
enable grid legacy containers (off)
enable container type icon (off)
Enable grid on containers (On)
Enable alternate grid color (On)
Enable extra bright background (On)
One thing I have also noted is that when you open a vendor pack with this set up it opens in freeform, however, any other container you then open also opens in freeform. and you have to manually change it back to grid with the little green button. After that the vendor pack also then opens in grid. I kinda figured having the defaults set as above would be an 'always' open the particular type of container as per the 'set' default.
It is not just 'me' that is having this problem so I doubt it is any set up of mine in particular that causes the stuff in the backpack to 'disappear' when dragging something from the backpack to another container in the backpack. Forcing you to close and reopen your backpack to 'see' the stuff. It also doesn't happen 'every' single time you move something but if you move say 10 items the disappearing trick may happen on item one or item ten, there is no rhyme or reason for it.
Perhaps if you set your stuff to the same as mine above and shuffle 40 or so items around in your pack you can reproduce it.