I'm not sure what you are trying to accomplish, but you are running into a basic design principle of Gtk2 timers. Timer callbacks must return a 1(TRUE) to continue, otherwise they stop (if you return 0 or FALSE).

Your script dosn't run for me, unless I add a return 1; to the timer callback. Of course, then I see your infinite loop printing happy, which is just caused by faulty loop design as roboticus pointed out.

sub dialog {
    if ( $magic == 2) {
    my $messagedialog_verification = Gtk2::MessageDialog->new( un
+def, 'destroy-with-parent', 'question', 'yes-no', "Verify waypoints?"
+);
     my $response = $messagedialog_verification->run;
     $messagedialog_verification->destroy;
        $magic = 1;
    }

return 1;

}
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