The problem was the combobox was firing the Form1.OnActivate event which created a new mdi child. OnActivate was set to ActionFirstChildExecute. I was creating a new blank child when the app opened. This had the described undesired effect. I removed the OnActivate and moved the ActionFirstChildExecute to OnShow. The app and combobox then worked as expected. There was nothing in the ActionFirstChildExecute to cause the behavior as shown in the code below. The problem was clicking the combobox fired the Form1.OnActivate event calling the code below.
procedure TMainForm.ActionFirstChildExecute(Sender: TObject);
var
ChildForm: TMDIChild;
begin
Inc (Counter);
ChildForm := TMDIChild.Create (Self);
ChildForm.Caption := ('NONAME' + IntToStr(MDIChildCount));
ChildForm.Show;
(ActiveMDIChild as TMDIChild).FormCreate(Application);
if ParamStr(1) <>'' then open_mru_item(ParamStr(1));
end;