Turn on “Auto Gather” and “Auto Pickup” under “Options”. It’s defaulting to “off” in 1.2.
Iron crafting appears to be completely borked now, though. Even with coal, iron ore, a hammer and a lit furnace, I’m not getting the option to craft wrought iron. (I even have recipes for wrought iron boots and iron gauntlets, but I don’t have the option to create wrought/pig iron).