After scanning the paper, I can't find where they mention that it must be acyclic. There's nothing stopping you from creating cyclic graphs in dataflow/reactive programming. Acyclic graphs only allow you to create Pipeline Dataflow (e.g. Unix command line pipes).
Feedback and cycles are a very powerful mechanism in dataflow. Without them you are restricted to the types of programs you can create. Take a look at Flow-Based Programming - Loop-Type Networks.
Edit after second post by pagoda_5b
One statement in the paper made me take notice...
For correctly ordered graphs, this process
monotonically proceeds to greater levels, thus ensuring data
consistency, i.e., the absence of glitches.
To me that says that loops are not allowed within the Scala.React framework. A cycle between two nodes would seem to cause the system to continually try to raise the level of both nodes forever.
But that doesn't mean that you have to encode the loops within their framework. It could be possible to have have one path from the item you want to observe and then another, separate, path back to the GUI.
To me, it always seems that too much emphasis is placed on a programming system completing and giving one answer. Loops make it difficult to determine when to terminate. Libraries that use the term "reactive" tend to subscribe to this thought process. But that is just a result of the Von Neumann architecture of computers... a focus of solving an equation and returning the answer. Libraries that shy away from loops seem to be worried about program termination.
Dataflow doesn't require a program to have one right answer or ever terminate. The answer is the answer at this moment of time due to the inputs at this moment. Feedback and loops are expected if not required. A dataflow system is basically just a big loop that constantly passes data between nodes. To terminate it, you just stop it.
Dataflow doesn't have to be so complicated. It is just a very different way to think about programming. I suggest you look at J. Paul Morison's book "Flow Based Programming" for a field tested version of dataflow or my book (once it's done).