I set all the analog capable pins to digital using ADCON1 as you suggested and it all works great now. I thought that disabling the A/D in ADCON0 would do it but apparently that enables or disables the analog to digital "conversion".
No, that would be too easy ;-) What it does is enable/disable the AD converter itself. Whenever a pin doesn't seem to work like it's supposed to think analog and dig thru the datasheet. I'd say 9 times out of 10 the problem is that the pin is configured for analog mode when its intended use is digital.

Is there anything I can do about the RMW effect or do I just need to be aware of it? If I pause after every pin state write my program will be too slow.
Like I said, using the LAT registers instead of PORT registers "isolates" the internal logic from the pins them selves which stops the RMW effects. So, whenever you're doing "bit-flips" on port pins on a device that HAS LAT-registers - use them.

With that said, are you still suffering from RMW now that you've got the pins properly configured?

appreciate your help. We are getting some of your Swedish weather here in NE Missouri today. No thanks for that.
You're welcome, to the help AND to the weather - please keep it ;-)

/Henrik.