Two wrinkles to be aware of - PRINT has no effect with FMTONLY ON, and SELECT = constant takes effect as soon as you SET FMTONLY OFF. So this works:

SET FMTONLY ON

DECLARE @X INT

SET @X = 0

SELECT @X = 1

IF ( @X = 0 ) BEGIN

SET FMTONLY OFF

PRINT 'was on'

END ELSE PRINT 'was off'

but this does not:

SET FMTONLY ON

DECLARE @X INT

SET @X = 0

SELECT @X = 1

PRINT @X

SET FMTONLY OFF

IF ( @X = 0 ) BEGIN

PRINT 'was on'

END ELSE PRINT 'was off'