You can't format the text displayed in a custom dialog. Plain text is it.
If you need that formatting you'll need to use another method to display the text such as a small window opened with the new window script step.
Would I be able to store formatted text inside a Variable?
How would I be able to format text inside a Mail Send function?
I'm trying to have a script email customers an Item Shipped email but would like to format some text and not able to do so?
It's the same limitation. Emails are plain text unless you acquire an email plug in that adds this utility.
The only text formatting you can put into your email (or a custom dialog) are "case" formats: Upper, Lower and Proper.
Would you happen to know of any Email Plugins that would be able to accomplish formatted text to be added to an email?
There are a number that advertise that capability. You can web search them and research cost and capabilities if you wish.