Thanks everybody for reporting back.
This works for me and does so apparently for everybody else.
Please re-open in case I'm wrong. Thanks again.
** Changed in: kdegraphics-kde4 (Ubuntu)
Status: Incomplete => Fix Released
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ksnapshot-kde4 "Region" capture mode blocks UI completely in 4.0.2
https://bugs.launchpad.net/bugs/198617
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