I have a user account, call it Designer, that has the privilege to modify all layouts. however, when she is in the Layout mode, Duplicate Layout is grayed out. I have looked everywhere and can't figure where to change this setting.

Thanks

Does she have "custom" privileges for Layouts? Specifically, is the "Any new layout" (at the bottom) set to "View only"?

Easiest fix, just set Layouts to "All Modifiable" instead of "custom."

The privilege to modify layouts is different from the ability to create (and duplicate).

I'd say the Designer privilege set has been given the option to modify the layouts. Creating new layouts requires [Full Access].