My answer relates to a similar, but not the same, problem, where I can't associate a file extension with a program with the same name of a deleted program previously used for this extension, when the new program is located in a different path. Nonetheless, this should be relevant to your case.
As others have noted, broken registry entries explain this behavior. I used CCleaner to get rid of the erroneous entry after I tried and failed to get rid of it by myself. This seems to happen when a program used to open a specific file type is deleted and you try to associate this file type with another program with the same name installed elsewhere. When this happens, Windows gets confused about the program used to open it, and the system can't associate the file extension with the new program.
You may want to look at this answer for more information and some cautions on registry cleaners including CCleaner.
.reg
file to manage file-types, so I never use it, but obviously a lot of people relied on it and have to resort to other methods now. For the record, the box is grey sometimes depending on the extension and context (it’s always greyed for executable types).