Is it me, or is there a bug in the program.

Neither, I suspect. The 3D view walls transparency does not actually make the walls transparent (walls cannot be transparent in SH3D), it is only a design tool to make it easier to see what you are doing (see recent blog: How to show interior parts hidden by walls).

Not sure what you (well, your mother in law) wish(es) to achieve, but you can import a box as a window and apply a transparent texture. See also thread 2954 with attachments.

ok