Can't drag objects into the script's Object Inspector public variables

Since upgrading to Unity Personal Edition 5.3.5 my old projects have no objects assigned to the public variables in a script’s Object Inspector. Strange thing is I can access the objects within the script as I could before. The public variables have no other assignments anywhere. I only get a small circle with a slash through it when trying to place objects into the Inspector, new public vars or old.

The little icon to open up the window of Objects has nothing in it to select.

To prove it I made a test script with only a single public Canvas variable in the class which showed up in the script’s Object Inspector but no way can I drag a Canvas to it.

I have set up Unity to run as Administrator (Win 7) because I saw another post similar but still no luck here… Bamboozled

@felixpk I tried to made a new project and it does the same. I only installed Unity 5.3.5 a few days ago.
Just updated with the 64 bit Editor patch 5.3.5p1 and now I don’t even see the public variables.
Error says there is no MonoBehaviour scripts in the file or the name doesn’t match the file name but it is simply not the case.