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You are right, templates in the Recycle Bin still show up as a choice in the Default Child Template attribute choices (which can be resolved by removing them from the Recycle Bin).
I would consider this a minor bug. It should behave like the Template Item attribute that shows a template in the Recycle Bin if already assigned, but doesn't show it as a selection choice.
This will be fixed in a future release of Ultra Recall.
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