Why is gross income (Box 1) on the 1099-R listed in the income section rather than taxable income(Box2a)
Yes it does that. Ignore the review and summary screens. Make sure the real 1040 return is right.
You have to enter the 1099R exactly as shown. The gross amount will go to 1040 line 4a or 4c and the taxable amount is on 4b or 4d.