I'm still using 2007 and I just started noticing today that SolidWorks is not letting me add relations between a sketch of one part and geometry of another part. Say I click on a corner of part "A" and then ctrl-click a point of my sketch in part "B". I used to get the option to make coincident. Now all I get is a selection window that claims the only selection I've made is the point in my sketch in part "B" even though I see the corner of part "A" still selected.
The only option I know that affects this is the setting "Allow multiple contexts for parts when editing in assembly". That option is checked. Is there another option I'm not aware of that I need to change?