If you want a dialog (form) based application, then save yourself a lot of pain by doing the following:

1) Set the forms ShowWindow property to 2 and leave WindowType as Modeless.
2) In your config.fpw settings file enter a line SCREEN = OFF.
3) Create a program and set it as main in the project manager, the contents should be something like:

do form myform
read events

4) In your form (on say a Close button Click() method) enter CLEAR EVENTS.
5) Build and run.

This is a very simplistic approach but a lot less trouble than what you are currently doing (IMHO don't bombard this thread *g*).