the problem only seems to occur when im in the direct left, right, front, ect (numpad 3,1 and so on).
For example if you press numpad 3 to go into right orthographic view then maneuver with the mouse ever so slightly and click grease cut it should work.
its at lease a work around you can use although your work wont be entirely accurate.
the grease cut is working when you set the grease pencil to object mode but it's not subtracting, so you'll have to manually delete all the faces. honestly the lack of customer service at CG cookie is frustrating. This is an issue that apparently has been present for quite some time yet with no solutions or alternative methods provided.
*edit: it did end up working but you'll have to try from multiple angles and then use the "symmetrize modifier" to readjust the cut. Hope this helps. This plug in is unfortunately outdated so I hope they'll release an updated version since Zbrush hilariously outmatches blender in this aspect.
Alternatively, there are a bunch of sculpting addons out there for this kind of functionality. One that I'm favoring recently is Sculpt ToolKit
I struggled with this for hours last night and this morning, it worked once on a simple cube, but never on the sphere, I tried all your suggestions to use object mode, to press 5 and then 3 on the numpad to get the right view but nothing works, I am frustrated and upset to have wasted so much time on this.
Sorry to hear about your frustration. This situation is always awkward because I've never been able to reproduce the show-stopping issues people seem to have with the Sculpt Tools UI. And while in hindsight I probably wouldn't have used the addon so heavily in the course due to stagnant development and age, I still am able to work with the addon - it's never been show-stopping-level obsolete in my experience.
But again, there are several options out there with similar or better sculpt tools.
To add to this Thread. I'm running 2.79b and I found I was able to get it to work as long as I was in orthographic mode. I had some issues when in one of the number pad views. I couldn't get it to work when I hit 3 for side view but as soon as I moved the view using the middle mouse button and as long as I was in orthographic view (hit number pad 5) I was able to get the grease cut to work.
I also used the built in Carver MT add on. That add on took a little while to get used to but it works great.