In the Tribunal quest "? Star is Born", how do you program those popup option boxes?

The Quest is the one where you learn the lines to a play.

They are called MessageBoxes, and the options are referred to as Buttons.
Many scripts use these functions.
The script in question is called playScript, so you can check how the functions work by looking at the script.
http://www.scribd.com/doc/7007668/Morrowind-Scripting-for-Dummies-9 is also a valuable guide to understanding scripting.