Hi - I think the 'blinking screen' issue is to do with the app being based in Java. Not that this is a full-blown excuse, just a reason. This problem was certainly worse a few versions ago... I hope the developers will manage to sort this out further. (Right guys?)
Moving incomplete files while they're being downloaded isn't such a good idea. I don't think you'll suffer any seriously unpleasant effects, but from the way things generally work with this kind of app development I doubt Limewire is *able* to dynamically track files that it is trying to 'fill up' if you insist on moving them. I don't see an option in the Preferences for choosing where the 'Incomplete' folder is to be stored... but I'll bet it is automatically placed where the folder for completed files is set. See 'Saving' in the Prefs for that.
Being a control freak isn't a bad thing - but us freaks have to learn the ins and outs of OS behaviour to stay freaky *and* sane! <g> And Mac OS X sure gives us some new wrinkles to learn.
(Note to the developers: it may seem odd if you're not fully steeped in Mac thinking, but people do want to move all sorts of things around without having to worry about it. Perhaps, if dynamic file tracking isn't possible via your development tools, there could be a Read Me section whipped to tell people what they can and can't do? Just a thought.)
Keith
technical editor, Macuser magazine
http://www.macuser.co.uk/