I must be missing something but I've created a couple new island cities and the only option in the colony screen is to liberate them to a foreign nation. Years later when they've grown a bit I don't even get the liberate option anymore. What do I have to do to be able to release these as a colony in the latest version?

you must have at least two cities on a separate landmass from your capital to make a colony.
so you can not to make a colony of 1-city islands. maybe by gift this cities to a colony when it is formed elsewhere.

This is a new change then with the latest patch? It used to be that if you had 2 cities on a separate land mass from your capital but each were an island near each other you could make a colony of them.

This is a new change then with the latest patch? It used to be that if you had 2 cities on a separate land mass from your capital but each were an island near each other you could make a colony of them.

No.

Btw. if an island is 4 tiles long you can put 2 settlers at each end of it and then build cities there while liberating them the same turn to be a colony... I often do this in maps where there is not much space... and the unsettled island is far away. This colony-spamming is one of the few advantages imperialistic civs have in middle-late game.

I believe there must not be ocean between them...