Are you using the Keil MCB900 board? If so it may not have the surface mount capacitors for the external crystal on it. If that is the case then you will need to solder some caps on there. I think 22pF - 33pF should do the trick.
Flash Magic does not change the device configuration by itself. Double-check that it is still set to how you left it. If not then something weird is going on with the device as UCFG1 should not change on it's own. It could be that maybe the device for some reason is not programming UCFG1.
If you forget to program the code in to detect the break condition, then the only means of recovery I believe is to use a parallel programmer. Versions of the LPC932 E, F and later have a hardware method to enter ISP mode using pulses on the RST pin, and so can always be recovered with the necessary hardware (assuming the Boot Vector was not changed).