Right clicking on a file -> Open With -> TextEdit. Instead of opening the original file, TextEdit creates a copy of it and opens that one.

As an administrator, I have both read & write permissions. I don't see anything relevant in the App's settings.

Any ideas how to fix this?

[Added] This started happening after I had to restart the system by...pulling the plug on it. I had a hanged-up app (not TextEdit) that would ignore the Force Quit command; in fact, it wasn't even listed as a process so I had nothing to kill to begin with.

[2nd Edit] If I start TextEdit first, and open the file from within, it works. I'm thinking that this may be a LaunchServices issue.