instead of using a giant picturebox to cover it, have you tried a giant label?

You could also simply loop through all controls on the form with code and set them all to disabled. (not hidden). This should gray them out.

Also since you know how to take screen shots, you could simply take one of your form and display the screen shot of the form in the form's picture box.

Showing a modal form won't stop code execution in the form if you use a background worker or a threaded timer.