Chris,
The hole wizard uses API functionality, in conjunction with an access database. It uses "canned" sketches that are used for cut-revolve features to create that actual hole. The way that they are dimensioned because they are planar sketches and not diametrical in nature, is through linear dimensions. The dimension that stipulates the diamter dimension is simply accomplished through a doubled distance (somthing that you can do when dimensioning from a sketch entity to a construction line) it simulates a diamter dimesion VALUE to make it easier for someonr to input diameters directly without having to divide to get the radius.
Now there is no way to change that dimension to a regular diameter dimension. Instead what you can do id to create a reference dimension inside the part which will come in when you insert model items/dimensions. Or, and probably the best thing to do is use the Hole callout in you annotations toolbar. With this feature, it will tell you all of the specifics about that hole for instance if you had a 5/16 counterbored hole that is 1.5" deep, you would get a resultant .335 DIAM 1.5 DP,.6875 C-BORE .200 DEEP.. and the wording would actually be replace with the approproate symbology.
Hope that helps
Jon