I typically have my laptop setup to go to standby when the lid is closed. which is perfect when I use it around the house or office. but i would love to be able to set it to do nothing when connected to an external monitor. that way I can close the lid and only use the external monitor.

Look through windows, DF has no business in that department. I remember seeing it somewhere, but i do not have time to devote to an extraneous search.

Display Fusion can not deal with this issue, It is a part of the Operating Systems management only.
All you have to do is go to the Control Panel, click on the Power Controller link and you can change the operations for your laptop, only there.
A simplistic way would be to create a shortcut link of the Power Controller on the "desktop" or "quick launch" toolbar locations, just to make it easier to get to.
There is another way using the PowerShell scripting, but that is a little more complex. You can do this but you must read and study the powershell scripting tech.