Not quite the same setup BUT
I have a query that finds the records I need. In the query I have a VIEW button set as "next to the item" When the VIEW button is clicked, the form is presented in a panel below the list (although I suspect that doesn't matter so much)
Traversal buttons all work ok in this scenario. I suspect your problem is you are running from a process which will open the form in a modal window. This mode of operation causes problems both with processes started from the form (you can't ) and the default buttons like traversal, print etc etc.