Devoted to understanding the basics and fundamentals of investing

Exactly. (In my opinion) There is no better gauge to a funds future performance than seeing how much a manager is vested in his own fund.

In regards to Janus, a large chunk of my equity portfolio is invested in Janus Contrarian (JSVAX). According to Morningstar.com, "Manager David Decker has more than $1 million invested in Janus Contrarian. What's more, in a recent letter to shareholders, the manager revealed that 98% of his liquid assets, excluding Janus stock, is invested in the fund."

Why invest in a fund if a manager won't eat his own cooking?

Those fund managers who put their money where their mouths are clearly demonstrate a personal, as well as professional, commitment to their fund's performance by doing so.

However, in some instances, fund managers are explicitly NOT ALLOWED by the fund sponsor to invest ANY PERSONAL funds in the same fund for which they manage client monies, due to a conflict of interest perception, concern about creating the appearance of self-dealing, front-running, or of other (unspecified) impropriety, or other (unethical) behavior, potentially in conflict with the fund manager's fulfillment of his duties and responsibilities as a fund manager.

There are also times where it would not be advantageous to have a manager have high incentives, for example, an index fund or a conservative bond fund.

All of the problems you mentioned Bob are real and critical. I imagine that the normal investment controls exist on Fund Managers to prevent the kind of abuses you mention for all of their money outside the fund such as black out periods for stocks the fund is trading, pre-approval of trades, copying confirmations of all trades to the compliance officer, etc.