I tried searching for this, but I didn’t find mention of this issue. If it has already been mentioned, I apologize. I believe I have found a bug with CTRL+Z and Smart Quotes. I have duplicatied this on two seperate machines. This is using beta 29.
Desciption of problem: When using the CTRL+Z keyboard shortcut to undo changes, the keyboard shortcut stops working when it hits a Smart Quote.
How to duplicate: Turn on Smart Quotes. Begin typing random text into Scrivener, including words and phrases in quotes. (Of course, you must actually type, not cut and paste.) Once you have a few paragraphs typed, begin pressing CTRL+Z to undo the typing. You should find that the undo process will stop when it hits the most recently typed quote. If, at this point, you click Edit>Undo, nothing will happen. Clicking Edit+Undo again, will work as usual. At this point, CTRL+Z will begin working again, until you hit the next Smart Quote.
Workarounds: If Smart Quotes are off, this behavior does not occur.