It's in the right-click menu. If the Smart Dimension tool is active, you'll have the option when right-clicking on a dimension when you first place it, but if you've clicked away from it, so it's no longer highlighted, you'll need to exit the function. Then you can go back and change it.
Edit: I just re-read your post. The instructions I gave above are for changing an existing radius dimension to show diameter. I have a vague recollection of an issue where dimensions that should show diameter by default were displaying as radius instead. Is that your problem, or did the above answer your question?