Don't forget that new signature permissions aren't retrospective - so if you set permissions to allow say only 2 links and someone already has 4 links, they will continue to have this. The only way around this is to use the Batch Update Users in the ACP to remove everyone's signatures and get them to add them again once the new signature permissions are in place.
I have found the problem, it has something to do with the plugin sonbb Xengallery. If i disable this i can set signature links. Not sure what to do now because my community likes this plugin very much. I will ask @sonnb .
Thanks Martok. I finally realized that the previously posted screenshot is simply a retrieval criteria filter. The following screen has "Remove Signature" checkbox. I'm assuming that I simply check that and click "Update Users" button.