After spending countless hours on the phone with Microsoft. I believe I have come up with a couple different fixes/work-a-rounds.
1. Replace %system32%\fdeploy.dll with the one found in SP2. This will solve all folder redirection issues pertaining to this post.
or
2. Make sure the users' profiles' folder structure has a "Desktop", "My Documents", and any other folder that you use redirection with. The fdeploy.dll that comes with SP3 handles folder redirection differently and will error out if the profile does not have those folders.
If you can, please post how you have your folder redirection set up and how it was fixed.
Nate
You can also adjust your GPO.
"Uncheck the "Move the contents of My Documents to the new location" option in the GPO (which is enabled by default on a new GPO). Once the GPO change has replicated to all sites, have the client logout and log back in and verify the results."
Folder Redirection Broken in SP3?
in Windows XP
Posted
You can also adjust your GPO.
"Uncheck the "Move the contents of My Documents to the new location" option in the GPO (which is enabled by default on a new GPO). Once the GPO change has replicated to all sites, have the client logout and log back in and verify the results."
Found here