Eric & Arne,
Copy and paste the following code into a PRG and run it. This demonstrates the effect I'm referring to:

create cursor crsSample (cDummy C(1), cColor C(5))
appe blan
repl cColor WITH 'Red'
appe blan
repl cColor WITH 'Green'
go top

oForm = create('ShowColor')
oForm.Show()

define class ShowColor as form
WindowType = 1

proc init
this.addobject("grdColor", "grid")
this.grdColor.RecordSource = "crsSample"
this.grdColor.Column1.ControlSource = "crsSample.cDummy"
this.grdColor.Column2.ControlSource = "crsSample.cColor"
this.grdColor.Column2.DynamicBackColor = ;
"IIF(crsSample.cColor = 'Red', RGB(255,0,0), RGB(0,255,0))"
this.grdColor.Column2.SelectOnEntry = .F.
this.grdColor.Visible = .T.
endproc
enddefine