best fix is to revert back to the older version and wait for the next patch or simply make one ingot items. you can still make one handed swords with dagger blades.
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I'm having the same problem I think it might be caused by the snapping to anvil mechanic that got introduced as i had 2 ingots on the anvil snapped at opposite ends which only allowed me to make a dagger blade. and the other ingot became unusable. Having said that you can still make short swords with a dagger blade but you get a funky message that says you created a dagger and one hand sword at the same time.
My suggested fix: Remove the snapping to anvil.