So, playing Butcher's Bay and when I get dialogue, it shows I clearly have two options as to what I can do. But all the game lets me do is push E and take the first option, because the down arrow option clearly can't be selected. Is there a trick to this?

Make sure you run the game as admin (right-click game's shortcut and select "Run as Administrator").

Actually what worked was the 3 and 4 keys! I just kept going through all the keys and they finally worked. :P