How to make my image a curved square?

[Blighty]

1) Work on a new transparent layer

2) Use the Rectangle Select tool to create a square selection

3) Select > Rounded Rectangle 50%

4) Select > To Path

5) In the Paths Dialogue make the path visible (Paths Dialogue is near the Layers Dialogue)

6) Edit > Stroke Path. Foreground colour will be used. Adjust Line Width to suit.

Bonus Question:
In the Tool Options, what Mode are you using for the fuzzy select tool? Is it in Subtract mode? Change it to Replace.