Currently when looking at a ship in the stations cargo hold list, the ship is divided by Equipment (what is currently equipped on the given ship) and Cargo (what is in the cargo hold of the given ship). When you click on the list headers for these two divisions (Equipment or Cargo) and hit sell selected, what actually happens is that you sell the ship that the Equipment or Cargo header is expanded from.

I think it would be more intuitive if "selling" the Equipment header actually sells only the equipment on the given ship. Likewise, the "selling" the Cargo header actually sells only the cargo in the given ship.