Hi Jacob,
Is this something that can be replicated with any user who choses to reset their password? Or is it only happening to a specific user/s?
It sounds like an issue that happens in both the reset password page (via the password reset email) and a manual password reset on a user from within the CMS. Is that correct?
Do you have access to the database? If so, when you reset the password is the encrypted value in the UserPassword field of the CMS_User table changing?