Mandatory user profiles do not work as expected on Windows Vista-based and Windows Server 2008-based client computers when the %LogonServer% environment variable is set in the profile path
In a domain environment, you configure the domain users to use mandatory user profiles. You set the profile path by using the %LogonServer% environment variable. However, when a user tries to log on to the domain from a Windows Vista-based or Windows Server 2008-based client computer, the user is logged on by using a temporary profile. Additionally, if the Do not log users in with a temporary profile Group Policy setting is applied in the domain, the user cannot log on to the domain.
Note: This issue does not occur if the user logs on to the domain from a Windows XP-based or Windows Server 2003-based client computer.
For more information on this issue, including potential causes, workarounds, and resolutions, see: Microsoft KB Article KB955625.