Well, I was probably always using that setting on my Workstation running standalone, rather than as a Client.
But I just tested with it running as a Client, both starting with the default local Library then switching to the Server Library, and starting connected to the previous connected Server Library. In all cases the Action Window remained minimised.
All my testing was with the Action Window minimised when I closed MC, as if I leave it maximised MC does open with it maximised on restart. As above, all the setting does is maximise the Action Windows if it was minimised when MC was closed. If the Action Window was already maximised it is left alone. Mind you, I have Auto Updates turned off, and possibly when that kicks in it maximises the Action Window again. I think some tool do that, although in a quick test they only open their own little window above the Action Window, which remains minimised.
I think that setting would be saved as a local Registry setting, so it would be used for any Library that was loaded. Certainly, I set it in my local library, but when I opened my Server Library it was still set the same way, turned off.
I have often thought that it would be nice to completely dismiss that Action Window when I am doing specific stuff, so I understand where you are coming from. But if it could be completely dismissed there would need to be a way to bring it back as well. Maybe a split window that uses Disclosure Triangles like the other panes would be good enough for you? But then people would forget it was there, and wouldn't find it. Actually I think all MC pane/window components should be resizable, including closing them down to just a bar with Disclosure Triangles. I would particularly like to be able to resize components in the Tag Window, such as the Dump area.
For me, in the end, the Action Window isn't a big enough issue to worry about. I just minimise it and leave it there. It doesn't use much real estate. Maybe someone from JRiver will comment.
PS: Leezer3, if you turn off the "Burning", "CD Ripping", and "DVD Ripping" Features in Options, the "Burn Disc" and "Rip Disc" items disappear. If you turn off the "Image Support" Feature, the "Camera" item disappears. That just leaves "Sync Handheld", "Build Playlist" and "Tag" items in the Action Window. Not too bad.