Is there a setting for smart objects in Photoshop (CS4) that change how they scale when using their handles. For some reason holding SHIFT is no longer maintaining their proportional aspect ratio and I'm not sure what's wrong. Seems like I must have accidentally hot-key toggled some setting off. Any ideas?
This turned out to be an odd kernel-type error that refused to clear itself until I completely shut down my computer. If nothing else works, and you run across this issue, try shutting down.