Okay, I was wrong. This is NOT just a bug in the dialog.

There's a problem with ClickOnce for VSTO in how it handles chaining in intermediate certificates.

http://support.microsoft.com/kb/970682

There are two things you can do apparently. The easiest thing is to install the certificate on the client computer.

http://msdn.microsoft.com/en-us/library/ms172241.aspx

The second one is uglier, and I'd go with #1 if I were you.
Edit the registry (yeah, see, I told you it was uglier).
Look for HKEY_LOCAL_MACHINE\SOFTWARE\Microsoft\.NETFramework\Security\TrustManager\PromptingLevel
Change the value for "Internet" from "AuthenticodeRequired" to "Enabled".
If you do this, they will be able to install the VSTO application even though it says "Unknown Publisher."
Of course, they will be able to install ANY VSTO application from ANYWHERE. (Yikes!)

RobinDotNet