Tried 3-4 different versions 4.X (even 4.6) with the same result. Due to urgency of the matter I have purchased a hosting account and setup 4.7.5 without a glitch.
It seem’s to be a sharing issue, maybe for some reason cookies between the two sites are getting mixed up?
I can try later on (in about 2 weeks) to test 4.8 (It’s still beta?).
I also want to try the Multi hosting (Network) setup, maybe this will address the issue.