Show your work with "background" images not moveable as a student

I have used show your work questions in the past and as teacher/creator inserted a background image and then additional separate images for students to categorize by dragging images using the square select tool into the correct category. Now students are unable to use the square select tool to drag these images onto the main background image, indeed as a student it appears as it the entire question is now one image. (Teacher side is still separate images) Students can still use the scribble tool, but that is not what is needed.
Here is a clone of the formative questions 16 and 18 are the show your work questions that are now being seen as one image by students.
Has something changed to accidentally break this?

https://goformative.com/clone/F9TA5R?_rid=0wzmp

@khawks as far as I know, students never had the ability to edit/select the background image a teacher has added.

Now students are unable to use the square select tool to drag these images onto the main background image

Do you happen to have a rough estimate of when students were able to do this?