You could try …
Open the component file directly and de-geo-locate it.
Use Aerilius’ Attribute Inspector to delete the “GeoLocation” Google Earth dictionary.
Then resave the component.
Now when inserted into a parent model it should not matter if the parent model is geo-located.
The “unlocated” component will not “know” where to be inserted so it will stick to the cursor.
If when saving out locally created components to a file, that they are inheriting the active model’s geo-location, then that would be a bug.
I just tried it in SU2021.1.332 and everything worked correct. It the test component did not inherit the working model’s geo-location. Inserting into a different geo-located model worked normally with the instance attached to the cursor.
Note that I started a new model before step 3 and geo-located it to a different location than the original working model where I created the test box component.
When things act goofy, it’s time to reboot the computer to clear out memory.