Peet,
Its a long long time since I drove the Hitachi 16 x 2 display.
What Franc says is right, you can't read the busy flag if you can't use the read line !
Using delays is messy though...
Also, in the initialisation code, I think that the "38" should be sent twice to make sure the display is in 8 bit mode NOT 4 bit mode.

I also use SYS51 and have written megabytes of code on all variants, but SYS51 infuriates me with its non-repeatable compilations, file trashing and general bugginess. The manual is awful as I am sure you've found. Still until a year ago it was the only Pascal compiler for the '51. Have you seen the new share ware Pascal ?

I have non-bus hosted 16 x 2 code in Pascal if you want it.
Steve