Try this:

WITH thisform.bgpageframe1.page2.grdordlines
SELECT Item_Master
SET ORDER TO TAG itemnumber
SEEK this.value
IF FOUND()
REPLACE ordentlines.description WITH Item_Master.description,;
ordentlines.nonstock WITH .T.,;
ordentlines.saleunit WITH Item_Master.saleunit,;
ordentlines.salemult WITH Item_Master.salemult
ELSE
REPLACE ordentlines.nonstock WITH .T.,;
ordentlines.saleunit WITH "EA",;
ordentlines.salemult WITH 1.000
ENDIF

otherhand try this:

-If buffering option is set to on check for the tableupdate function is used correctly

-Try the step by step debugger to see if the program pass throug the lines after the ELSE section.