If I hit the 'q' key to de-select or drop the targeting item back into my inventory, even without using it, it disappears. I can be holding/selecting it, standing right next to a bug nest/hive and mad clicking the spawner pods, nothing happens. I drop the selection tool, again it goes poof.

I'm on Steam so it forces me to the latest Factorio version published.

The disappearing remote is a known issue, but it failing to do anything is a different problem.
Do you have any other mods besides Factorio Standard Library? When holding the remote what color is the targeting symbol it paints on the ground?

The remote controller item is a leftover from the time when you still had to craft the controller. nowadays you just use the shortcut.