That seemed to be broken for me as well in 2014. My fix was to just extrude it a very small amount in world space, then I was able to use local to extend it out further...Crappy for sure. I also ran into issues with my Gizmo becoming "distorted". Local extrude is working as intended in Max 2015, though!
I'm trying to extrude edge using Shift+Drag with a local coordinate reference system, but for some reason it doesn't work. I keep dragging, but the extruded edge doesn't move in needed direction. Is there something I do wrong or there's another way to do that? I made a video of it…
I've never really liked Max's local extrude, works accurately for me about half the time. I would recommend Illusioncatalyt's extendsurface script, been using it for years in production and it's a good alternative to max's if doesn't give you the desired results.…