>I'm working on my first project and have some very elementary (dumb) questions.
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>1) When I open a project, do I have to type "set default to ..." in the command window? If I change the defaults in the file locations of the options selection in the tools menu is that just for that project or any other project I open. Eventually, I hope to be able to distribute my applications - I'm not certain how I tell FoxPro where to find the files then.

The only reasonable development requirement is to place all project-related files on normal tree, i.e. project file in root folders and other files (forms, reports, etc.) in subfolders. This case project will always find all components, and distribution will be Ok.
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>2) I have a form in whick I create a grid based on a SQL. It works for one time through. But.. I want to run this in a loop so that the user can select the continue button & start over. When I do this, I get the message, file in use. I close the cursor with a USE but I'm not certain how I delete it. My background is Clipper & cursors are foreign. Then, how do I set the file that I create the cursor from as the primary file?

You better base you grid on cursor/view. You can create a cursor either by CREATE CURSOR command or SELECT ... INTO CURSOR ...

>3) How do I remove the bar that shows the query is running?

SET TALK OFF

>4) Coming from a DOS background, I'm used to my forms taking up the whole desktop. Is this not done in VFP? If so, how do I adjust the size of the form? But also the objects on it?
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Form.WIndowState=2
you may also add some code to Form.Resize event to adjust controls location dynamically.