Hmmm....
1. If you open a dwg from your temp directory, it will create a .dwl file, which your event handler will react to and try and open in Acad...not a good scenario.
2. The fatal error is coming from the fact that if you say WBLOCK a block INTO your watched folder, it detects the file creation, reacts, BUT, Acad hasn't finished writing the file and your event is trying to open it...not good either.
Just some thoughts off the top of my head.
Cheers,
Glenn.