“Application.Message.LeftButtonUp” loads indefinitely when trying to select a GameObject with disabled selection

Steps to reproduce:
1. Open the attached “cozy_builder_unity_project.zip” project
2. Open the “LS_GameIsland” scene
3. In the Hierarchy Window, find “LevelGreyBox/Capsule”
4. Disable selection for the “Capsule” GameObject with the hand icon
5. Click on the “Capsule” in the Scene View
6. Observe the results

Expected result: Nothing happens
Actual result: The editor freezes indefinitely while loading “Application.Message.LeftButtonUp”
(Partial fix results in the error "GetAllOverlapping failed, could not ignore game object 'object' when picking" being logged instead which is still breaking for this bug)

Reproducible in: 2023.3.0a16, 6000.0.36f1, 6000.1.0b4, 6000.2.0a1
Couldn't test in: 2021.3.48f1, 2022.3.57f1, 2023.3.0a15 (Because of third party errors)

Reproducible on: Windows 10, Windows 11
Not reproducible on: No other environment tested

Note: Not reproducible on a new project