I think the biggest issue of this entry is that the core player activity here is opening and dismissing the 'I don't need this' dialogue, which won't be very interesting for a player. As a consequence if player starts dismissing these dialogues quickly they are going to miss the dialogues that have a different message.
I think better solution is to only have a single input from the player to handle the items they don't need. Perhaps more, dialogue is better saved only for when they find something useful as that is what their attention is better focused on.