Not able to move object with mouse after scaling object below specific size

Hi
I am having some problems with moving objects in Illustrator. The problem occurs as I scale the object down below a certain amount. It only seems to happen with objects from outside of Illustrator (.jpeg, .pgn, etc.), text and other stuff made within Illustrator seem to be fine.

I have tried restarting Illustrator and my MacBook multiple times, every other program is closed, and Illustrator is fully updated.

I am using the following specs:
- macOS Monterey (Version 12.0)
- MacBook Pro (14", 2021)
- Apple M1 Pro
- 16 GB

Any help would be much appreciated!