(Again, I assume that this is a zvt bug, hence gnome-libs.)

Pop up two 1.2 gnome-terminals.  Stack vertically[1] for best effect.

Start a selection in one terminal - hold down the mouse button in the
middle and drag around.  Observe nice selection.  With the button still
held down, move the pointer over the other window.

Observe that the stupid gnome-terminal doesn't bother to distinguish
between the window you are waving the pointer over and the one that the
selection is happening on.

This is a PITA when (as I do) you have virtual desktops with 4 big
terminals on and like to do the "drag outside window to scroll" thing.

[1] By which I mean y rather than z-axis.