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Hello Wim, It should work even if it's not selected first, even if selecting it first works fine too.
After a SmartDimension is applied you can always select the dimension text and a small black arrow appears next to the Dim Arrows. If you click on one of the small arrows (mouse symbol looks like a pointing finger). Then a little box appears where you can select which level that should be affected. The object with the red text is the one currently affected by the dimension. You can easily change by selecting another object in the list.
Under Options, Interaction, there's a setting which is set to hold the selection when you apply SmartDimension - "Keep selected shape as affected/owning object when creating dimension".
With that option selected the selection edge color will not drop when you select the SmartDimension tool and the assembly is selected.
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