No - the allocation is not part of the set up phase. In the set up phase you set up your grading criteria etc and then you switch phases to the submission phase. Then students can submit their work. When they have submitted their work then you can allocate who assesses what. Also if you look at the documentation page Workshop settings you see that manual allocation and random allocation which you refer to are actually in the section on Submission phase. (Where did you see about a pull down menu by the way? I will clarify the docs.) Here is the direct link: https://docs.moodle.org/en/Workshop_settings#Submission_phase
If you'd like to try a workshop with user data, log in to the School Demo site Mount Orange - here is a direct link to a course with a workshop in it http://school.demo.moodle.net/course/view.php?id=59 Log in with the username teacher and password moodle. (But avoid trying just before or just after the hour, as the site is reset) Then you can play around with the workshop settings and see how it operates.
Hi Paul. I am sorry about your confusion, yet i fully understand it. The Workshop module has a lot of area of improvements like this.
At the moment, the current version of the Workshop has been designed so that allocating for peer-assessment can be done only after there are some students work submitted. To make that happen, you have to switch the workshop phase from the setup phase to the submitting phase and let your student submit their work. Once that happens, other options (such as those pull-down menus etc) will appear.
Also note, the Workshop does not support the "set up and forget" approach. In its current versions, continuous intervention of the teachers is needed (there are plans to have it slightly less dependent on them in the future but it is a long way to go there). So at at the end, maybe the Workshop will not be the best tool for your faculty's needs.