I had this installed for a while but gave up on it because it just annoyed me without a flush screen. I was having all the same problems you guys are describing.
Have you tried hannip's Poutlook Sms fix? I've got installed on my 800w (no TF2D installed) and it allows me to use the normal WM6.1 to manage texts. Maybe that'll fix it.
http://discussion.wmexperts.com/showthread.php?t=168468