Terence,
In your very technical explaination of iPhoto - you seem to be missing the point of the question completely.
On Apple's website the explaination of iPhoto is as follows "iPhoto for Mac lets you do more than you ever thought possible with your photos. It gives you easy ways to find, sort, and rediscover your favorites. Simple but powerful editing tools let you turn good shots into magnificent ones. And you can share your photos in all kinds of great ways, including fun slideshows, Facebook, and Twitter — even professional-quality prints, photo books, cards, and calendars. iPhoto isn’t just a collection of pictures. It’s a collection of possibilities."
From this it seems like you should be able to easily FIND, EDIT and SHARE your photos. Yet when the library is grayed out it is difficult to do any of these.