I have the same problem but it only happens if you double-click a
folder. If you double click, then the selecting stops working. If you
right click the folder and choose 'open' it still works fine. I'm
running twm with thunar installed as my only file manager and it stopped
working when I upgraded from 8.04 server to 10.04 server.
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thunar select freezes after using mouse to select folders ("detailed view" mode)
https://bugs.launchpad.net/bugs/520118
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