It looks to me like the previous settings you may have had it on were "Alliances." Check to see if Alliances have been enabled, and if so, turn them off, since you can't have teams AND alliances. If that's not the case, can you also Print Screen the settings tab? Thanks!
*Alliances: A game type where everyone starts on a FFA, but can make an "alliance" with another player on the map to further their own agendas. Alliances in this fashion can also be broken when one of the members decides on it, so these teams can be quite temporary and shifty. It's much more cut-throat than simple team games.