Yeah, it is likely some bug in there somewhere. From my experience of using CW and P&E together, those bugs are almost exclusively caused by CW.
As an alternative, you could use P&E PROGHCS08 instead of the CW debugger. That program is intented to use for batch programming and is way quicker than CW. (Actually, I believe CW implements some stripped version of PROGHCS08 to do the P&E programming.)
You get PROGHCS08 with the Cyclone delivery, or alternatively you can download it for free from
www.pemicro.com. If I remember correctly, I think they are also giving out their HC(S)08 debugger for free nowadays.