Controlling include/exclude state of components in Derived Assembly dialog box

Issue

When you try to modify the state of Inventor assembly components in the Derived Assembly dialog box, you notice that some components cannot be included or excluded.
The Exclude button (second icon from the left) is grayed out:

Solution

This is as designed behavior.
Following two elements determine this behavior.

1. Non-master Level of Detail (LOD)
   If the assembly was saved in a non-master LOD state, you will not be able to exclude parts from the derived part. Their state is managed by the LOD. Additionally, all suppressed components will not be shown in the list, so you can not include them in the derived part. If for your current task, you don't need a LOD, switch to the Representation tab of the Derived Assembly dialog box and choose "Master" as your Level of detail or clear the "Associative" checkmark. As a result, all components will now show up in the list on the Bodies tab and you will be able to exclude parts on an individual basis.
   
2. Visibility state in the Current Design View Representation
   Some components are set as invisible in the current Design View Representation. This setting affects the state of components in the Body tab. For example, an occurrence that is invisible is automatically set to the Exclude state  and you are no longer able to include it in the derive operation. To override the default settings and allow inclusion/exclusion of components without any interference of the Design View Representation, clear the "Associative" checkmark on the Representation tab.

Here is the video demonstrating the issue and the solution: