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Good point!
Right, the software is sitting on the W7 machine which is acting as a "server". As a standalone on that machine, it runs fine.
The XP machines are mapping to the W7 machine and trying to run the executable over the network. This is where the problems start.
It's a really old bit of software and runs straight from an .exe; it's not installed in the normal sense and has no registry or event log impact. The only error it returns is "Error 560", which is one of Photosoft's own internal errors and no use to man nor beast, alas.