"Inline" option for field labels doesn't work

Problem/Motivation

When attempting to manage layout with custom fields, I would like to display the field labels using the inline option, but using any option other than "hidden" or "visually hidden" results in the label displaying above the field.

Steps to reproduce

Install Commerce Kickstart 3.x. and create customised versions of "physical products" supplied by the templates.
When managing display, select "inline" for field labels, the label will display above.

Or:

1. Install Commerce Kickstart 3.x. demo site with demo products.
2. Edit an existing product, the example I used is "White & Wood Chair"

Resulting in this:

Selecting the "above" option has the same result. It is possible to hide the labels again using the settings