If you see the ‘character’ in front of the camera in the game while having Game Settings over, supposedly this is their new way of helping you set Avatar scale limitations by visually showing you it. You can apparently set the max or min height of the characters Height, Width, Depth, Ratio, etc.
I’ve also experienced this ‘freezing studio’ issue where the Game Settings window just goes unresponsive. I’ve always seem to seen it happen if I was to ever click the ‘Avatar’ tab and edit a different setting in a different tab that I click save and it locks up.