This is a weird one...
First of all, thank you for the video, it's so much easier to understand what's going on when I can actually see how things fail to work.
Based on what I see, I would assume that this is something that is specific to this particular document. Have you tried to add form fields to a brand new document? You can do this in Acrobat by making sure that no other document is open, then use Shift-Cmd-T to create a new document with one blank page in it. Now select Tools>Prepare Form - because this is a new document that was never saved, Acrobat will prompt you to save it. Once saved, try to add a form field. Does this work? Does the form field behave the way you would expect it to behave?
If not, then it's very likely that there is something wrong with your Acrobat installation. The first thing I would try is to select Help>Check for updates, to make sure that you are running the latest version of Acrobat DC. If that still does not help, I would uninstall Acrobat and install again from a fresh download. You can download Acrobat from here: Download Pro or Standard versions of Acrobat DC, XI, or X
If the problem is specific to your document, let's find out why that is. It's possible that the document is corrupt. There are different ways you can try to recover from some corruptions: The first thing I would try is to do a "Save As" to save to a new filename. Does that work, or are you getting an error message? If you can save to a new file, does that new file show the same problems? If so, then try to extract just that one page into a new document. To do that, open up the Page Thumbnails pane on the left side, and then select the page, right click and select to extract the page. This sill create a new document with just one page in it, save that and try again.
If you are still not able to add form fields that behave correctly, it gets a bit more complex. How was the file created? What application was used to create the original file, and what application was used to save the file as a PDF file? Would you be able to share this file?
Great trouble shooting explanation, appreciate it.
I created a new document, with the instructions you provided, and it still didn't work.
I then moved down to your next instruction, and updated acrobat. Once the update was installed, I re-opened acrobat and followed your instructions again about creating a new document. It worked! Seems like the update fixed my issue.
Appreciate you time and help, happy its working!