I am very happy to report that my problem with RDP client on Windows 7 hanging has been resolved.
Thank you very much Antman for the technorabble link. I copied the RDP7 client files from my work Windows 7 PC to my Home XP SP3 PC and ran the RDP7 client; I now have no more hangs in on my Windows 7 RDP client when I'm doing RDP twice.
EDIT: My problem returned completely also with the RDP7 client on XP. But I do have a workaround. When I RDP twice, the second RDP hangs (the hang happens after trying to make a connection with the 2nd RDP). But if I RDP into the work PC, leave the first RDP into the work PC up, open a second RDP on the home PC into my work PC (causing the first to disconnect), then when starting RDP on the work PC, RDP will not hang .
The other really strange issue I have is when opening OutLook 2007 and logging into the Exchange server, Outlook will hang for 5mins before it makes a connection to the Exchange server. The workaround above also fixes this issue.