Freedom of Movement allows you to run with the King's Gifts. Whether or not this is a bug, it seems likely that it's definitely a bug that the flag and all indication you're carrying the gifts vanishes along with the movement speed debuff.
Yea...pretty sure that is definitely not intentional.
Freedom of Movement is hardcoded to remove any and all movement penalties; it is unlikely this is fixable.
What you can do is have the King's Gift absolutely strip any and all buffs while holding them. Kinda like Red Star Disciple? Prevent buffs from being cast on you.
That doesn't work for things that have permanent freedom though and I think you are vulnerable enough when you pick up the gifts without being full dispelled.
What, exactly, gives Permanent freedom? Any kind of Immunity like that should not exist on EFU.
Easily solution is picking up the gifts to dispel freedom and stop the spell from working on someone holding the gifts.
Will PM you with what does.
Just an FYI that Freedom of Movement effects will now be removed once picking up King's Gifts, and casting the spell won't work on PCs that hold it.