I nearly missed this question since it was in the subject line:-)
You can do this:
(swank:create-server :dont-close t)
Then it will start the server on port 4005 and keep accepting connections in a loop.
I also missed this option. That's better but there is still a stream error raised on the REPL which is ugly. I think a well placed IGNORE-ERRORS would help close the stream silently. I guess it doesn't really matter to raise an error when the stream is broken, we can't recover.