sorry for keeping you waiting for so long.
You are absolutely right. The behavior of the display when showing an image in panorama mode for which the panorama zoom factor is < 1.0 the behavior has always been to set 100% as the next zoom state. This used to be okayish when images were normally not much bigger than the screen resolution, but with very large images the panorama zoom factor can be significantly smaller than 1.0, making the first step very large. You are also right in that mouse wheel zoom does not exhibit this behavior.
Changing this behavior might be an option, but it’s unfortunately nothing that can be done short-term. What I can offer as a workaround is the attached simple demo program FineZoom.zip (14.8 KB) which implements basically the same thing that the display control is using for the mouse wheel zoom - in this case accessible through a button array. The principle is simple: Precalculate a series of zoom factors been the largest (in this case arbitrarily set to 64) and the smallest (which depends on the image size and the panorama zoom factor) and when zooming in, move from the current zoom factor to the closest one in the appropriate direction.