After spending some hours experimenting, I can now answer my own questions.
WFW can be turned on/off in my Win7 SP1 system with the latest CIS installed. The Domain, Home/Private, and Public monitoring of WFW are all working. The Inbound and Outbound rules I set for WFW are also being observed, so far.
Some of you guys think this is a bug, but it's the best setup for me. I hope this "bug" won't go away in my system.
Why?
I had been an NIS user for many years, but I got tired of paying for it and not getting what I need, which is a backup function for its firewall rules. Many of us NIS users have been requesting it for a long time (check out the forums), but the company just wouldn't or couldn't produce it.
In my case, it's quite important for a FW to be able to restrict application access according to site/domain/IP with rules. Most FWs give you only two options: allow/block. I have been searching and testing FWs for sometime. So far, I have known only two FWs that fit my need: that of NIS (nope, leaving it) and WFW (well, what do you know!). All of the IS packages I tried disabled WFW but couldn't restrict application access according to site/domain/IP, until I came across CIS. Fortunately for me, this "bug" exists in my first installation, and it allows WFW to still function. Yeah, I have to re-enter all my NIS rules into WFW, and it doesn't allow me to save the settings, but hey, it's FREE.
[Addendum] About saving the WFW settings, I just found information on exporting/importing WFW rules through the Windows Registry. I haven't tested it, but it's one good way of saving critical WFW rules.