OK, I called Breitling USA today and their tech support was able to help me solve the problem. I was looking for things like "reset" in the manual, but didn't find anything. Turns out I really wanted to look for "deep sleep" instead, as getting the watch into that mode is key in the reset process.
To put the watch in deep sleep before the battery runs out, unlock the crown and turn it until the battery mode is shown in the top display. Then hold the top pusher until the watch goes to sleep (displays go dark, hands stop moving). That's the first part of the "reset" sequence.
To complete the reset sequence, connect the (powered) charging cable to the watch for a few seconds to bring it out of deep sleep.
Once I completed those steps, I was able to go through the hand initialization process, set UTC, then set the (correct) offset for TZ1 and now the hands and display correlate properly with UTC and the configured offsets.
Not sure how I introduced the discrepancy, but at least now I know how to fix it.
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