This is a small point, but I was trying to override both the reply and new message forms with hook_form_alter() and this really confused me.
To override the new message form it is
function MYMODULE_form_privatemsg_new_alter(&$form, &$form_state, $form_id), but to override the reply form it is
function MYMODULE_form_privatemsg_form_reply_alter(&$form, &$form_state, $form_id).
Why is there an extra "form" in privatemsg_form_reply()?