The user modified menu is stored under ~/.config/menus/.
Favorites on the other hand are stored in your ~/.config/plasma-org.kde.plasma.desktop-appletsrc file.
Kickoff uses a different entry for favorites than the other kicker based menus.
Kickoff uses “favorites”, [“systemsettings.desktop”]
Kicker uses “favoriteApps”, [“systemsettings.desktop”]
If this is not what the kickoff menu containment line looks like in your plasma-org.kde.plasma.desktop-appletsrc file, then I’d say it a bug and needs to be reported upstream. https://bugs.kde.org/