Just to be clear.
When you create a formula field in the Field Explorer it does not alter the existing data. It is not like an update script. The formula field itself can be placed on the report canvas to display the result of the formula. At no point does any formula in crystal alter the source data.
SO if you place, on the detail section the original field "DDB_PAT_BASE.Gender" and the next to it the Formula field that references it you should see the the origianl numeric value with ther translation into text next to it.
If you place them side by side what is the result?