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In our web application, there's a very conventional top navigation bar, with five or six items. As is pretty common, the user accesses their individual Account Settings form by clicking their username in the upper-right corner. The Account Settings form is very simple and limited for users.
When we present the user's Account Settings screen, is it confusing or jarring to deselect all of the top navigation items? What are some ways to communicate the user's context?
It is less confusing to select none than to select the wrong one. If you don't have a menu item in your top level navigation for user account then don't select one.
There are numerous examples of sites with minimal or non-existent top level navigations, or ones where navigation is broken into chunks for various reasons. The navigation menu and its highlighting is not necessarily there just to provide context. Once within a specific area of a website the context can be re-enforced with the specific design of that page, for example, when selecting Facebook's message nav item you are presented with a purpose built page for messages. The design of the page focuses the user and re-enforces their position on the site.
Facebook is a good example. I might have selected one of their top level navs, such as home, or my profile name, but I might also be quite deeply buried, the context is provided by the design of the elements I am focused on and their surrounding elements.
The top level nav also serves the purpose of providing the user a quick way of getting to important, commonly used site areas. On many sites this is stuck to the top so even when scrolling down it is still quick to get back. Again, the focus is on the page and the design of that page re-enforces the position in the site, even if it is not appropriate to highlight a top level nav item.
