The best way to cancel an addingrecord event in the gridex control that I've found is to call the cancelCurrentEdit() function. I was initially setting the e.cancel property to true, but that had the side effect of not letting me change the focus from that row in the grid :)
If isGoodRow = False Then
grdPeople.CancelCurrentEdit()
Else
insert the new row into the database, etc.
End If