I don't know what happened but now when I move over an object with the selection tool a little hand icon appears. Can anyone tell me how to disable it? I find it kind of distracting. Thanks.

Nothing you possibly changed in Inkscape's preferences would change the cursor symbol(s): Since Inkscape 0.47, it uses the same cursor symbol (including the hand) for the select tool, with the hand symbol indicating a selectable object underneath the pointer. It is not possible to change this symbol or turn it off at runtime (you could of course modify Inkscape's sources and recompile it with a custom cursor symbol ;) )

Possibly you used to work with older versions of Inkscape before (<= 0.46), and only recently upgraded to the current release?

I think by default if you save the file as a simple SVG file, it groups everything on the save. Then when u open it pretty much everything on the drawing belongs to the top group and is a movable object, indicated by the hand icon.

I've been using the same version. I probably just didn't notice it before. Do I feel silly now.

Not as silly as we feel