When an XYEvent layer has been created from an Oracle table (connected via an Oracle OLE DB provider), spatial and by attribute selections are disabled even though the source table does have a unique index defined on an integer field (Oracle data type number(n)).
This is a data type mapping issue when using the Oracle 8.1.6 OLE DB provider to make the connection to the Oracle database.
Use an Oracle ODBC driver to make the connection. Integer fields will be mapped to short integer/long integer data types. You can use any of these fields as a temporary ObjectID field when creating an XYEvent layer from the Oracle table.