First, you have to start the TeX-server. With OS2.0 you may use ShowDVI's Shell commands - > ARexx TeX Shell menu option. Otherwise open a new CLI window that will be reserved for interaction with the server. Under 1.3 don't use ShowDVI's menu for this, because ShowDVI is always waiting for this CLI to finish before responding to any other commands. then start the TeX-server ("rx TeX:rexx/TeX-server") in this CLI.
You will be prompted if you want to call the editor as soon as virtex encounters the first error. If you answer yes, virtex will call an editor through the TeXedit.rexx script as soon as the first error is found. Otherwise, you will be able to enter commands in virtex in the usual manner (you may still use the 'e' command to call the editor).
Then you will be prompted if you want to be asked for a format name whenever an application wants to compile a file using the default format. You are now going to ask "But what is this default format?". Here is the explanation: virtex and/or the TeX-server use the environment variable ENV:TEXFORMAT to store the name of the default format. Thus, if you call virtex from CLI without specifying a format, e.g. "virtex TeXRexx", then virtex will not use the plain format, as it always did before, but will use the format of name specified in ENV:TEXFORMAT.
When you call the TeX-server via some Start_TeX macro, you can specify a format name, or you can give no format name, or you can specify a format name of '?', in which case you will be prompted for the format to be used. If you called some Start_TeX macro without specifying a format name, and you started the TeX-server and answered "yes" to this second question, you will be prompted for a format name. If you answered "no", the default in ENV:TEXFORMAT will be used. If ENV:TEXFORMAT is not yet defined, you will be prompted too. Sounds complicated? Try it out!