The rig is physically plugged into COM3 on the PC. In psdr/if, on the "if setup" page, there is a tab called "rig control" there is where I have psdr setup to run the rig. (COM3) Then, in the general setup, there is a tab for CAT. There is where I have hrd controlling psdr. (COM7) In hrd the CAT is set to COM6. As I said, this works perfectly. There's no way you can have psdr and hrd both controlling the rig directly. COM ports won't allow it. That's why Scott modified it that way.
When I was editing my post I inadvertently erased a major point I was trying to make. Leave HRD set as you have it. On PDSDR's setup menu go to Setup IF and set Rig Connection -->Rig Type to "Ham Radio Deluxe". This will set HRD and PDSDR to talk to each other via DDE instead of having to use a virtual com port software. The only com port that will be used is Com3. It works 100% here.