Is there a way to turn this feature off. Ever since I installed Parallels 3 on my MacBook Pro, when I click on a .doc file (e.g. an email attachment) prepared in Win Word, the file always opens in the Windows VM and Win Word, rather than Mac Word. This is annoying because it takes so much longer to launch the VM and Win Word compared to Mac Word.
Yes, there is now a way to turn SmartSelect off. Download the latest update, it adds that option (and fixes the exact issue you are describing).
jmgould, Build 4560 includes many bugfixes in SmartSelect and your bug is expected to be fixed too. Please try not to disable SmartSelect but click menu Applications->SmartSelect->Set To Default. It should fix your issue.