Instant searches do not use the search options that you can set on the Search toolbar. Instant searches have a separate set of reduced search options that only apply to instant searches.
You can set the options for instant searches via the Search|Instant Search Options menu item. Directly clicking this menu item shows a popup dialog with a checkbox for each option that applies to instant searches. If you only need to toggle one search option, it will be quicker to use the submenu of Search|Instant Search Options to toggle that option. By default, the Instant Incremental Search button on the main toolbar has a drop-down menu with the same instant search options.
These are the three options that apply to instant searches:
Case Sensitive
Whole Words Only
Loop Automatically
Search menu
Search|Instant Highlight
Search|Instant Incremental Search
Search|Instant Find Next
Search|Instant Find Previous
Search|Instant Replace