Thanks Sacha.   

I enable the CDN over the weekend (thought it would improve performance) and didn't tie the two together.  Disabling the CND gets rid of the above error.

Still the same with adding a new module and back to square one on this issue. 

I have the exact same problem !
I used Fiddler and tracked the fallowing web service that works very fine.
http://website/DesktopModules/InternalServices/API/ItemListService/GetPages?sortOrder=0&includeDisabled=true&includeAllTypes=true

then I found out that the actual problem is in dnn.dropdownlist.js.

it is basically in line 587 that has "model.children.length" apparently there is no length property :
"Uncaught TypeError: Cannot read property 'length' of undefined "

But it is impossible becouse I can see on the line above the model has children and has length of 13

Children: Array[13]
0: Object
1: Object
2: Object
3: Object
4: Object
5: Object
6: Object
7: Object
8: Object
9: Object
10: Object
11: Object
12: Object
length: 13
__proto__: Array[0]
Data: Object
__proto__: Object


I am really not understanding how it can happen to it !
more wired is that I copy the website folder into a VPS using the same DB and it works like a charm :O
I mean what ever it is , it can't be sever side ?!