This took me about an hour to figure out, so maybe this will help someone else.
I found that this guide was not entirely correct when I tried to switch my parameter layout from a text box to a combobox: https://tech.knime.org/report-parameters
That is, I couldn't right click and edit my report parameter in the Data set view of the BIRT report creator. Instead, all I got was an option to Insert into Layout. So, I have attached screenshots of how I was able to edit the parameter. Otherwise, the guide was very helpful. I hope this helps someone.