After importing an image or a sequence, Undo does not undo the action. Instead, it repeats the last action.
I.e., with a single imported image, it inserts that image again, at the cursor position (the following frame).
If a sequence has been imported, Undo will repeat the insertion of each image, one at a time, going back through the sequence.
This is the case whether using Ctr+Z , or Undo in the Edit menu. Ctrl+Z seems to work fine otherwise.
I’m using what I assume is the latest version, by the way: v0.6.5.
@JonR thanks for the report. This is an issue that’s been reported and discussed before, however since it stems from a more complicated problem, the way this and other related issues are going to be fixed called for implementation of a new undo/redo system which is already being developed as seen here https://github.com/pencil2d/pencil/pull/953
Of course it’s still pending additional features to make it as robust as possible when dealing with most Pencil2D tasks, but as it is right now, Undo/Redo is a bit limited when working with image sequences, because importing each image is considered a separate action, so undoing all the clip is not currently supported (but it will be AFAIK).