OK so using the setq-default inside a hook is probably not a good idea.
But I can reliably reproduce this problem, I'm surprised you couldn't.  If
I start emacs using emacs -Q and open an org file everything is fine.  If I
then evaluate this

(setq-default TeX-master nil)

(defun org-mode-reftex-setup ()
  (load-library "reftex")
  (and (buffer-file-name)
       (file-exists-p (buffer-file-name))
       (reftex-parse-all))
  (define-key org-mode-map (kbd "C-c )") 'reftex-citation))
(add-hook 'org-mode-hook 'org-mode-reftex-setup)

and try to open an org file I get prompted "Master file: ~/".  I'm running
Ubuntu 11.10 and the emacs-snapshot package: GNU Emacs 23.3.1
(i686-pc-linux-gnu, GTK+ Version 2.24.5), latest org pulled from git today.
Is there any more information I could provide to help diagnose this problem?

Cheers
Chris.

On 7 February 2012 19:15, Nick Dokos <nicholas.dokos@hp.com> wrote:

> Christopher Witte <chris@witte.net.au> wrote:
>
> > I've had a small problem with orgmode and auctex.  Follwing the auctex
> quickstart I added the
> > following to my .emacs
> >
> > (setq-default TeX-master nil)
> >
> > and then from the orgmode FAQ to setup reftex in orgmode I added the
> following
> >
> > (defun org-mode-reftex-setup ()
> >   (load-library "reftex")
> >   (and (buffer-file-name)
> >        (file-exists-p (buffer-file-name))
> >        (reftex-parse-all))
> >   (define-key org-mode-map (kbd "C-c )") 'reftex-citation))
> > (add-hook 'org-mode-hook 'org-mode-reftex-setup)
> >
> > With both of these, whenever I opened an org file I was asked to name
> the master file.  If I comment
> > out the setq-default I don't get the behaviour I would like with
> mulitfile tex files.  My solution
> > was to change
> >
> > (setq-default TeX-master nil)
> >
> > to
> >
> > (add-hook 'TeX-mode-hook (lambda ()
> >                (setq-default TeX-master nil)))
> >
> > I then appear to get the behaviour I desire.  Is this a good way to do
> this?  If so I might add it
> > to the FAQ.
> >
>
> Probably not. setq-default sets the default value of the variable
> whereas the hook is supposed to set the local value in order to override
> the default value: setting the default value from a hook seems backwards
> to me.
>
> Actually, I added the above code (*without* the TeX-mode-hook mod) to my
> minimal .emacs and opening org files does not generate any questions. Are
> you sure you have diagnosed the problem correctly?
>
> Nick
>