The button is grayed out.
If I put my mouse over the button I get the following reasons why I cannot create a Division :-
1. Not an active leader (he is)
2. General already in a unit (he is not)
3. General is an Army, Corps or Divisional leader (he is not)
4. Not enough assets (0 divisions are requiring this form-up cost)
No idea what this last one means and I have not seen it before.
I have plenty of money, conscripts and war supplies.
I think the new 60 division limit may be the problem? (I'm Union) What was the old division limit - 48? Maybe I have gone past that and hit a bug?
I have tried removing all units from 10 active Divisional commanders and then relieve them of their Divisional command - in no case can I then restore it.
Nasty bug I think just in time for the British bank holiday weekend

I will post you the save.
Cheers, Chris
Edit: can anyone else playing under 1.09e try and remove troops from an active Divisional commander, relieve him of command and then restore his command?