I've been investigating this further and have found that the problem can be reliably reproduced.

I have submitted this to the Google forum at http://www.google.com/support/forum/p/sketchup/thread?tid=6b0a0298daee1261&hl=en

At the above link I have posted links to SU files that can reproduce the error, as well as a YouTube video showing the bug in action.

The work-around in my case seems to be to ensure that the component is in "edit" before using Project Photo (when using match photo).

Hope this helps some others

I am seeing the same problem.
SU 7.1.6860.
Windows XP Pro on a laptop with 2GB memory.

Modelling a building for Google Earth 3D layer, I have a component that represents a vertical slice from roof to ground level. I add this component 5 times, aligning them to produce the building frontage.

When I look at components in the model I see my original plus 4 others suffixed #1 #2 #3 and #4.

See image here, http://www.screencast.com/t/NzFjNGMzO

I am not doing any scripting here. Just standard SU move tool to position the component.

This is the first time I've seen this in about three years of using SU. I have been away from SU for a few months, so the only thing I can think of is an update to SU has introduced this bug.

Can anyone shed light on the cause of this?