Hey, I had a similar problem, as well as a broken display. (2020.3.4)
Using the EditorApplication.update callback allowed me to get around both problems:

private void ShowErrorReportWindow()
{
EditorApplication.update += Show;
void Show()
{
EditorApplication.update -= Show;
ErrorReportWindow errorReportWindow = ScriptableObject.CreateInstance<ErrorReportWindow>();
errorReportWindow.ShowModalUtility();
}
}

It's not a very nice trick but it saved me

Is there any plan to fix this ? It's a shame not to have this working properly, modal windows are crucial when creating custom tools/workflow.

What's the point of this function (and the associated misleading documentation) if it doesn't work as described? It would be very useful to have such a function but at least fix the documentation so people don't waste their time like I just did working on an approach assuming this function works as advertised only to discover that it doesn't work at all.

If this will never be fixed (which is dumb because this would be super useful), just remove the method because as far as I can tell, the method actually does nothing more than ShowUtility.

How is this low priority? As far as I can tell, there's no other way to create a custom modal dialog in the editor. This is a core requirement for many tools and workflows, and with any normal window management should be trivial to implement. The effort to reward ratio here seems very high.

Unity 2019.1.10

The same thing seems to also happen for 2019.1 ... using

CreateInstance<SomeEditorWindow>().ShowModalUtility();

user can still fully interact with editor