I don't think you can "embed" forms. Maybe someone else has a better solution, but here's a few thoughts.
I would do as I stated earlier, maybe with the addition of a check box that says, "Other Fruit". That way, you only have to check for the existence of the check box value on your action page (the page the form submits to).
On your action page, if the checkbox was checked, use the "newFruit" fields, if it hasn't, use the one from the select box.
Hope this points you in the right direction. You could probably use Javascript, maybe combined with a popup box to add a new fruit, but that's beyond a simple reply.
<!--- Form Page --->
<form action="actionPage.cfm" method="post">
Choose a fruit:
<select name="fruit" size="1">
<option value="orange">Orange</option>
....
</select>
<hr />
<input type="checkbox" name="newFruit" value="1" /> Add a New Fruit
<br />
Fruit Name: <input type="text" name="newFruitName" /><br />
Fruit Cost: <input type="text" name="newFruitCost" /><br />
Fruit In Stock: <input type="text" name="newFruitInStock" />
<br />
<input type="submit" value="Submit" />
</form>
<!--- Action Page --->
<cfif isDefined("form.newFruit"

>
- insert new fruit into database using the values from the form
- do whatever else needs to be done
<cfelse>
use the fruit selected from the drop down menu
</cfif>