"ShadowFX will not function with WindowBlinds running." WITH WINDOWBLINDS, not with skin applied - feel the difference?
"This is because the OS shadows are designed to only work with the specific shape and style of the OS theme." Which shapes? What styles? Entire program works for a few SPECIFIC elements?
"You may be using older skins which did not define their own shadows but tried to use the OS ones." I work with WB & SkinStudio more than 10 years. Creating own skins and editing others gave me (I supposed) enough experience and understanding, how it works. Of course I switch both states of shadows: simply "enable shadows" and check this option and supply appropriated images. NOT WORKS.