Well, you may already be doing this, but on the window's page I would suggest adding a RadAjaxManager, and then add whatever Button (or LinkButton, or FormView) you use to update the form to the collection of ajaxified controls. To execute the client script after the button's postback, use
This will eliminate any screen flicker in the window's page and also tends to make it work just a little faster.
On the parent page, simply put the RadGrid and the HiddenField inside a good 'ole asp:UpdatePanel and the refreshing becomes ajaxified.
This may be a bit of a philosophical thing, but if you're not using the RadGrid for any of its other features, such as grouping, sorting, filtering, paging, etc. then you'd be better off using either a Repeater or a ListView control as that will speed things up too (sorry, Telerik).
Now, in response to your comment about Telerik having this built-in. They do, sort of. There is a "Pop-Up Edit Form" mode for the Grid (which I think now uses a Dock control instead of a Window) which does automatically rebind the grid after an update. Demo is here:
I have found in my own experience, though, that it's far easier to make the data entry form look good and easy to use by creating my own .aspx page and opening it in a window as you are already doing. But in terms of what is the easiest possible solution for the developer, what Telerik has built-in is the best.
Hope that helps,