The Palette Form is a library of objects that you can use in your diagrams by dragging and dropping
In a way it is just a short-cut - once you have placed a symbol from the palette on a diagram then the original is almost irrelevant. But CD maintains a pointer to the original symbol.
Drag Mode (not yet on picture) With Drag Mode on you do not have to drag from the palette for each symbol, you just select one in the palette and then when you drag on the diagram the selected symbol is placed where you dragged. If the symbol has a picture it is sized to the palette settings otherwise it is sized to match the area you dragged in.
Can you define your own symbols?
Whilst this is possible (using the menu's in the Palette) this is not recommended at present (a future revision may allow this.) The reason is that the Palette, which is stored in cdPallette.mdb, gets updated with some new releases of ControlDraw and so if you changed it then a new release would lose your new symbols.
However it is no problem. Just create a model, then make a symbol that has the properties that you want. Then you can run two instances of ControlDraw and copy and paste between them.
In fact you can use such a model as a reference model as well. Take a look at Milkshake3.cnd or MPPH3.cnd sample models and you will find a diagram called Standard Symbols, at the end of the list of diagrams. These are defined in the reference model (S88Reference.cnd) for those projects.
You can in fact change the palette in Tools Utilities so you could copy the standard one and point to your copy, and then change it.