I had the same exact problem and it was very frustrating to find all these discussion topics but no answer to the problem.
What fixed the problem for me was toggling the AMPSNAPO (Ignore Z coordinate) variable to OFF.
When drawing or editing an object, only the Absolute Coordinates will display. COORDS is set to 2. When drawing a line with the cursor, for example, the first point is picked, but then only the Absolute Coordinates will be displayed for subsequent points. Pressing F6 will toggle the display to the Relative Coordinates mode, but as soon as the cursor is moved, the display will revert to Absolute mode.
What is the method of repair to return the Coordinates display to normal function?
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