Tested with only CBA and ALiVE,

I walked up to a civilian and hit arrest, he continued to walk away so I used the "Release" action and he then stopped.
I have tried this with multiple civilians and it seems to happen with all of them. The first arrest action will not do anything, but then hitting "Release" will cause the civilian to stop moving which then results in the actions being switched ("arrest" releases them and "release" arrests them).

Can anyone else confirm this?

Just tried with CBA, ALiVE and Koplic map

I was able to walk up to a civ, select arrest and he joined my group. Release seemed to work as well.

mission.sqm -
http://pastebin.com/XFLCzCPQ

Hmm, I'll try again soon. Thanks for the feedback.

the CBA update today was screwed up in PWS if you use that maybe re-install CBA ?? Not sure if that matters anyway but hey ;)

Yeah it works fine now with and without your mission example, not sure what was up earlier because they were not joining my group but they are now. Guess I got Arma'ed...

Civs were drunk

The group indicator will appear at the bottom of your screen and you can give the civ orders using the F keys. Doing some tests tonight I'll try and reproduce this.