When this menu item is selected, the dialog shown in Figure 1 will be displayed. Make sure you always navigate to the Dict folder, since all dictionaries must be stored in this folder.
Keep in mind that the words you have selected in the Output list will be deleted from the source dictionary during this operation. Use the Copy to dictionary... command if you only want to copy the words.
This menu item will be ghosted if either you don't have an individual dictionary open (ie. you have the Reference dictionary, Flashcard dictionary or Kana-to-Kanji dictionary open instead) or there are no words selected in the Output list.