After a few days of pulling out our hair and troubleshooting this whitelisting issue that some of you have reported, we're finally getting to the bottom of it.
The good news is, whitelisting is not completely broken. You can still whitelist domains from the cli with no issues by calling pihole -w [domain-to-whitelist]. The issue only affects whitelisting from the admin page (whitelist page, query log, and block page)
Take a look over this pull request where I've attempted to explain what is going on. Though, we're a bit confused ourselves, and any insight from the community would be greatly appreciated!
There are a couple of options, we can either revert the change that broke it, or use the fix in the above pull request. Whichever way we go, rest assured that we are working hard internally to make sure that we have the bug well and truly squashed, and will try to get a fix out as soon as we can (and really, take that soon in the Blizzard sense of the word).
In the mean time, do not attempt to whitelist from the web admin, it wont work... apologies for any inconvenience this causes.
In Other news, we have updated the release blog post to include instructions on how you may possibly be able to update your version of dnsmasq to be able to update to Pi-hole 3.3