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In trying to work on an issue from the Drupal Commons issue queue, I've eliminated Commons as the source of the issue and I think I've tracked it down to Organic Groups. In a fresh D7 site, If I install og and og_example, I'm able to reference existing groups when creating new Posts.
By default, the Groups audience field has "Default widget type" set to Select list. I'm able to choose from existing groups using the default widget. I'm also able to choose from existing groups, if I switch the Default widget type to Autocomplete or Check boxes/radio buttons. However, if I chose Autocomplete (Tags style), the following error appears at the top of the Create Post page:
Warning: Invalid argument supplied for foreach() in entityreference_field_widget_form() (line 815 of /path/to/docroot/sites/all/modules/contrib/entityreference/entityreference.module).
... and when I try to use the autocomplete field, nothing gets returned.
When I tried creating a reference field between two arbitrary nodes on a site without OG installed, the default Autocomplete (Tags style) widgets from Entity Reference don't seem to have this issue. It looks like the integration between OG and Entity Reference is bundled with OG, rather than with Entity Reference itself. I'll start looking at that code for clues next.