you heard wrong. if you don't aggregate properties (treat them as 1 unit) the PAL is released only on the property that is sold in a fully taxable transaction (a 1031 exchange would bar recognition of the PAL). If you aggregated (meaning you treated both properties as 1 unit) then none of the PAL is released until both properties are sold in a fully taxable transaction.
However there is an exception: some or all of the PAL on property B may be released if there is active participation and your modified adjusted gross income is $150K or less see form 8582