Keyboard shortcut (App Shortcut) taken? Cannot use "^Z"
just a guess… but sounds like something might have a custom map to "Undo" because Cmd/z &amp; Cmd/shift/Y are alternates for Undo. 

For it to be auto-replacing inside system prefs would make me think it is not a system key command, but a third party, Karabiner, TypeIt4Me etc