Okay, last post (=

If you still do not understand a problem so it is simple: while (busy==0); does not work because when LCD is not enabled (LCD_EN = 0; // CLOCKS E LOW) the 0xFF is read from data bus and so bit 7 of P0 is set. As result, your chkbusy() does exit immediate and do not provide enough time for complete a command especially "clear display" one which takes much more time than rest ones.

Good days