Hope it's okay to add to an existing thread, I'm having the same problem. I have a family of 7 sims with two sets of siblings and one from each pair is married with three kids so there are quite a few different relationships.
I had no problem a few days ago making them siblings, spouses, parents/children, uncle/nephew and uncle/niece, but now when I try to re-create them (I wasn't happy with a few things), I can only select half the options. Sometimes if I try to choose brother, it stays as roommate, another time I try to choose something for one sim, but it changes the relationship with the sim above them in the list as if my mouse isn't configured right.
I don't know if the way you make the sim has anything to do with it as I create a son by making a twin of the father, then changing his age. That's the only way I can get the perfect face and when I first made the family last week, I did by choosing child from the new sim dropdown and selecting the two parent sims whose genetics I needed.
I have tried a few things like saving the two pairs of siblings separately, or each sim separately, then merging them bit by bit, but even if the first four work, it messes up on the fifth eg the parents recognise him as their son without me even changing their relationship options, but I can only change one of his parents from roommate to father while his mother stays as roommate despite me clicking mother in the dropdown. I've only got up to 5 sims since this problem started, trying to sort it out before I add the final two kids.
I tried a completely different family, sims I'd downloaded on Mod the Sims, in fact, and there's no problem at all. Whether that's because it's a family of just 3, I don't know.
I'm not sure this has anything to do with custom content as I hadn't got any before the problem began, then after I added some there was no change, and also no change when I removed the custom content again.
Other things I've tried:
Restarted game
Restarted PC
Checked game is up to date with patches
Ran "Fix Game" in Origin and that ran fine.
Removed the cached files except the one that shouldn't be deleted.
It's probably simply a problem with choosing from the dropdown list, but I've added all this detail in case anything is relevant or helpful.
Other details (I read the "help us help you" post, so I hope I've included everything you'd like to know) - using Windows 7 64-bit, DVD version of game, no other errors and no error messages.
That is not only ok but desirable to post in existing threads if you have the same issue.
Thanks for the detailed report.
