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The Catholic Church have two understanding of grace. There is actual grace which you provided the definition for. Then there is the sanctifying grace which you are not mentioning. It is this sanctifying faith which the Catholic Church feels one needs to do in order to maintain their salvation. Thus one has to replenish this grace through the Eucharist, indulgences, and other works defined by the Catholic Church. It is these types of works that Luther rally against and said the Church was in error.

I'm not interested in what other Protestants have to say on the matter no more then what you would feel some liberal Cardinals would have to say on Gay marriage. The only true source of information is from the Holy Scriptures themselves. It plainly states (among other places):

Ephesians 2:8 For by grace you have been saved through faith; and this is not of yourselves, it is the gift of God;

We see here that grace is a ONE time act by which WE HAVE BEEN SAVED. There is no "sanctifying" grace nor is there anything that we must do to merit that favor. Nor does it state anywhere that grace comes to us through Baptism as you indicated in your post. God grants us His grace and we respond to HIm through our works. But we don't work to keep His grace.

If we received grace BECAUSE of Baptism are you saying that God does not give grace UNTIL one is Baptized? How one answers that question shows whether they believe in works as a method of salvation. It just underscores my (and Luther's) point.

The Catholic Church have two understanding of grace.

Only TWO??

'When I use a word,' Humpty Dumpty said, in a rather scornful tone,

' it means just what I choose it to mean, neither more nor less.'

'The question is,' said Alice, 'whether you can make words mean so many different things.'

'The question is,' said Humpty Dumpty, 'which is to be master - that's all.'