We have difficulty to update email performance report setup. Anyone has ideas or suggestions.
There are issues (similar to the ones you've mentioned in your Q) with the new modal and AFAIK, Marketo is working on rolling back to the previous stable version of the asset selector modal while it works on fixing the new modal.
I initially thought we were experiencing this as well, but after some testing, realized that the selection capabilities were there, just not as obvious as I expected. In our case, we organize email assets in a way that allows us to select the parent program folder name, and the UI will reflect how many emails will be included in the report. Hit Apply and all worked as expected. I also tested this by expanding the Emails folder and manually selecting the 6 emails.
Check out the official communication from Steven (Marketo PM) regarding the rollback process here.