Hi Otis. I discovered the following.
This behavior is intentional. When the ratio of your width to height reaches some critical value, the icon changes from a box to either an I (if width << height) or an H (if height << width). When this happens, the plot will only zoom one axis using the values indicated by the bars (I zooms the Y-Axis, H zooms the X-Axis).
This does mean you can still draw smaller boxes. You just need to be careful about the ratio of the box width and height.
I can anticipate scenarios where having an easy way to zoom just one axis is desireable, and this seems like a reasonable solution. If you have feedback about the current sensitivity or critical ratio being used, perhaps due to a specific scenario you are facing, please do feel free to provide feedback by contacting customer support.