This is still not working for me .
I'm using Manuscripts 1.0.3. (Note: The "About" screen still says 1.0.0, but when I check for updates, it tells me I'm running 1.0.3.) My manuscript was created in 1.0.0 and I have since updated. I've been inserting references with Magic Citations from Papers 3.4.1. I'm using El Capitan (10.11.1) on a 2011 MacBook Pro.
When I click the "Add Citation" button, references I've already used appear in a list, so they are being stored somewhere.
However, Insert>Bibliography is grayed out. I've created a section called References. I've tried highlighting the word references, placing my cursor before the word, placing my cursor after the word, and placing my cursor in an empty paragraph/list below the heading, and nothing seems to make Bibliography available.
I've also tried changing the citation style (I'm trying to use Chicago 16th author–date), and that doesn't seem to help, either. And I've tried creating new dummy documents to test... No matter what I do, I can't seem to get it to work.