Howdy,
I had exactly the same issue - changing some fields or options and SQL Query block would not update!
After turning OFF ALL caching features (I was using cache cleaner, session cache and memcache) the settings remained and now all working.
I'm not entirely sure which fixed it - I got frustrated and just turned it all OFF and all works
I hope this info helps someone.
Cheers.
EDIT: My issue is Memcache - I enabled one setting at a time and carefully verified, and only when I enabled memcache did the settings disappear. I've switched my caching to Joomla native caching and it works.