Symptoms:
When attempting to insert a custom list form in SharePoint Designer the form never displays in design view. There is no error message, and the form never gets inserted into the page.
Cause:
There may be multiple causes. Thus far, we've identified that it can occur because of a failed SP1 install for MOSS. If you take a look at the Netmon traffic and compare it to a healthy server all you'll notice it is missing SOAP calls. Note: The other thing that is odd about this issue is that all SPD users will experience it.
Resolution:
Method 1 - Fix the failed upgrade.
You'll need to reinstall SP1 using our recommendations:
Method 2 - Clean up the user profile.
You'll need to clean up the user profile using these steps: