There is an area beneath my farm area that CATCHES kids trying to pick up pebbles.
It's not the same pebble but it IS the same spot, just south of the westernmost LARGE rock formation below the farm.

My kids go to grab the pebble but get stuck and turn back and forth til the item is gone. The only way to UNstick them is to manually drag them away.

Is this a known issue with a fix coming soon?

We are working on those problems, but in the meantime it will work better if you drop the kids above the pabbles, rather than on them. If you do that, they will usually not get stuck.