There was a bug with the line selector (or cursor) on greyscale targets which was fixed right now. So if you update to the latest current build (r16381) the selector should be back.
P.S.: If this doesn't help, try resetting your settings too. You can do so by either switching hold to "on" when Rockbox boots (past the Apple boot screen as described in the manual) or deleting the config.cfg while the Ipod is attached to your computer.