First off, let me say how impressed I am with your concern. I really appreciate your diligence to my question.
I'll answer your questions in order:
1. The fact that Windows keyhoard shortcuts work for you, while F&R is running is---in itself---revealing. For clarification, I'm going to explain in detail what I am referring to as "Windows keyboard shortcuts" so that we are both on the same page here:
* If I go to a shortcut icon on my Desktop, for example Quicken, and choose "Properties" from the right-click menu, I am presented with a property sheet with two tabs.
* Choosing the "Shortcut" tab, I can go to the "Shortcut key" textbox and enter there a letter/number/other keystroke which-----combined with either [Ctrl-Alt] or else [right-Alt] will execute the shortut (i.e., run the program).
* In the example I have used, pressing [right-Alt+Q] will run Quicken on my computer. I have many such shortcuts set up on my machine.
* This is the function that, on my computer, is disabled after running F&R (i.e., after running F&R, pressing [right-Alt+Q] does nothing.
Okay, now I'll move on.
2. No. If I exit F&R my keyboard shortcuts do not work until I either reboot or re-start the computer.
3. I use Windows 98SE (I know, it's dated, but it has been absolutely bullet-proof for me so far, and I have a lot of confidence in it).
4. No other hotkey program running, although Toshiba has its own hotkey program available, which I don't use (btw, I'm using a Toshiba laptop). I do notice, however, that Toshiba's Tfunckey process is running (visible via Process Monitor, from Sysinternals.com).
5. Yes. The break key does work to launch F&R.
6. I have tried this already, but did so again for the purpose of this post. (a) Windows booted without F&R loaded; (b) launched Quicken (just to keep the example consistent) using [right-Alt+Q] as a test: Quicken launched fine; (c) launched F&R tray utility (less memory), then launched Quicken via F&R: Quicken launched fine; (d) Closed Quicken, then tried to launch Q via [right-Alt+Q]. Received Windows "ding" and no launch; (e) Closed F&R tray utility and tried again to launch Q via [right-Alt+Q]: Windows "ding" and no launch; (f) Tried other keyboard shortcuts with similar response.
Another, perhaps important, point:
I just now noticed that the programs I have set up to launch via an "F" key (in other words, F1, F2, F3, etc.) work fine. The ones presenting difficulty are the ones requiring the Ctrl-Alt/Right-Alt prefix.
I'd be curious to see what the experiences of other Toshiba users has been.
After posting this, I will disable the Toshiba Tfunckey process, then re-start the computer to see if that plays a role. I'll report back.
Thanks again. This is interesting.