I don't remember in which version this changed, but at some point using smart guides alongside scaling became much more finnicky.
You might notice that proportional scaling works if you attempt to maintain an exact 45 degree angle with the cursor while you drag, and horizontal scaling if you move the cursor precisely horizontally.
To turn it off, go to Preferences > Smart Guides and turn off 'Transform Tools'. Of course, there may be situations where you want smart guides to work alongside transform tools, so this is a workaround rather than a solution.
Wow. It worked. I used to keep that selected in previous versions, but now I guess I have to deselect it.
THANKS SO MUCH!!