Try increasing the size of your Hero Lab window - the "Select Game" form is limited in size by the Hero Lab window, so if you make that bigger you should have more space.
Hiding games that you haven't downloaded is something that's on our to-do list that we hope to implement in a future version of Hero Lab.
Sorting by "last used" isn't good for usability, because then you lose the ability to predict which games are in which order; Microsoft tried something similar to that with their menu items in Office 2003 (I think), but it just made the menus more confusing, because you could no longer predict which items would show up where.
