There's been a change of behavior when comparing two variables that point to the same object -- you can't rely on a simple AppleScript test for equality.
on resetTextLineReplace:sender
set textLineReplace to ""
if sender's isEqualTo:radioSelectButtonOne then
set textLineReplace to "replace"
else if sender's isEqualTo:radioSelectButtonTwo then
set textLineReplace to "before"
else if sender's isEqualTo:radioSelectButtonThree then
set textLineReplace to "after"
end if
display dialog textLineReplace
end resetTextLineReplace: