My current project uses AC version 1.70.1, but despite having "Items can be re-ordered in Menu?" ticked, I'm unable to do so.
I've just checked a backup from a few weeks ago (1.69.5), and there I am able to reorder items without any issues. I haven't touched that menu since, so I think this is probably a bug?
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I'll attempt a recreation. Can you share shots of your Settings Manager, and properties of the menu / InventoryBox element from the Menu Manager?
Never mind - recreated. Look out for a fix in v1.70.2.