Expand.exe failure on WS08-R2

[Benzi Eilon]

I have a .Net C# application which does, among other tasks, the following:
1. Copies a number of *.CAB files to the same folder
2. Per each CAB file, starts a process which executes the EXPAND command to
extract all the files from the CAB file to the same folder (each CAB contains
several hundreds of small files)
3. Waits for all these processes to finish

Note that there is no overlap of files between the CAB files.

This works fine on XP and WS03 but fails on WS08-R2. Investigation showed
that on this system Expand.exe is a new executable, (version 6.1.7600.16385,
size 64KB) while the XP version is older (5.1.2600.0, size 16KB). My
application works fine with the old version of Expand.exe (even on WS08-R2)
but fails with the new one.

Note: the new Expand.exe succeeds if there is only one CAB file and
therefore only one process to extract it.

Running the CAB expansion processes as a CMD /K with the new Expand.exe
showed me that after many output lines (one per each file in the CAB) of the
form:

Adding <file_path> to Extraction Queue

I get the following error messages (in most of the processes):

[QUOTE]
Expanding Files ....

One or more files could not be expanded. Delta Package Expander Returned
0x80070003

Expanding File <cab_file_path> Incomplete, Error Code=0x80070003
Error Description: The system cannot find the path specified.
[ENDQUOTE]

or:

[QUOTE]
Expanding Files ....

One or more files could not be expanded. Delta Package Expander Returned
0x80070002

Expanding File <cab_file_path> Incomplete, Error Code=0x80070002
Error Description: The system cannot find the path specified.
[ENDQUOTE]

Please explain what is the reason for this problem and how to overcome it.

TIA,
--
Benzi Eilon