So I had this problem for the first time after coming back to replay the game. Googled it. Found this. I had a hunch, and I don't know if it was sheer dumb luck or if it's just one of those wonky things but it worked for me.
Basically, I was out exploring, knew where the chests were in the mill, went and got them early, made my way around the map, got the key, and came back, and nothing lit up so I couldn't complete the quest even though I unlocked the chest. I reloaded, and recalled that originally you have to use Aard to break down a door to get into that room in the basement. So I went down there again, used Aard on the already broken down doorframe, held the witcher sense button, then lo and behold it worked and the quest completed. Again, no idea if that's a real thing or not, but it's how I did it.