When someone picks hardware wallet shouldn't it make "Restore or import wallet" unselected? People will pick it and input their Trezor seed into the wizard. I think selecting "New" and "Standard wallet" with provisions to accept a Trezor seed are probably safer. Or more warning they are losing hardware security in the wizard on the screen where the user types in the Trezor seed.
I agree. It needs to be obvious to the user what is happening.
Trezor signs the transactions, not Electrum. Electrum doesn't need to know the seed words of the Trezor.
With a Trezor wallet on mytrezor.com all set up I load Electrum. I'm given a choice of "Create New wallet" or "Restore wallet" while selecting "Hardware wallet", it might not be obvious to everyone what one to pick if I want to use my already set up Trezor. If I pick restore it asks for the seed words to be entered. I think I've seen on other places people picking restore and confused why it was asking for the seed words. It might make it easy for people to make mistakes with their backup seed.