Hi Gregg,
The 7831R doesn't use watchdog timers, so the NI-Watchdog install problem shouldn't affect your application. A re-install of the drivers might take care of it though.
As for your example, you did all the correct steps leading up to running the example. After "AI-Single.vi" compiles and downloads to the FPGA, just keep it targetted to the PCI-7831R in order to run it, instead of targetting back to LabVIEW for Windows. This is actually taking real-world values, so if nothing is connected to your device the signal will be floating. (Note: this does not make use of a Host VI)
If you want to use a Host VI architecture, you are correct in that you will have to then change the target back to LabVIEW for Windows. To better understand this type of application, take a look at the shipping examples "Synchronization - Polling (FPGA)" and "Synchronization - Polling (Host)". You'll notice that all the Host VI does is call an Open VI Reference (which opens and runs the pre-compiled FPGA application, "Synchronization - Polling (FPGA)" ), and then uses Read/Write Controls to pass data back and forth from the Host to the FPGA.
Let me know if you have anymore questions.
Jeff M.
Applications Engineering
National Instruments