Windows XP sp2 / Folder Redirection Policies and Internet Explorer Maintenance Policies (phew)
Found an interesting bug regarding XP2 and Group Policies.
When you apply a Internet Explorer policy to a XP SP2 machine, it only works first time. Any subsequent updates to the policy forces it to actually receive “nothing” via GPO.
http://support.microsoft.com/kb/888254 has the fix, but you have to request it.
Also believe that after applying the fix (and the registry fix also) you need to clear out any local profiles stored on the machines.
Fun fun fun 🙂