>Suppose you have database foo.dbc in c:\foo\data\, and another database foo.dbc (same name) in c:\foo\lastmonth\data\, and you'd like to work with both of them, so you open up both. Is there a way to reliably discern what will happen if you then call a program that executes "SET DATABASE TO foo"? It seems awfully ambiguous to me.

As Sergey wrote you can switch betwwen the databases writing full path in "set database to" command. But the questions still are open. What VFP does when the command is "set database to foo" (without path) ? How to check which database is current databes ?
IMHO VFP can act quite strange when two different databases with the same name are open. Yo can try to avoid editing in such situation and close the second database as soon as it is possible to make things more clear to VFP.