Obviously by using the internal oscillator you can omit the external crystal shown in the easyPIC5 diagram. Some of the config lines in the code might need removing as you are using a different family of PICs than the one I used for testing. When I tried your code it compiled OK, but you have one line missing which could be the cause

Code:
DEFINE LCD_BITS  4               ' LCD bus size (4 or 8 bits)