This might be caused for the same reason that IIS sites with local folders also fail sometimes -- the problem occurs because .Net is unable to enumerate the full path to the folder. In other words, the target folder may have the right permissions, but for UNC paths, the share or the physical path to the folder may not grant list access. It works sometimes because a process on the local server may have accessed the folder causing the path to be cached, in which case, things move along just fine. However, when the path is not cached, the permissions error occurs.

In developing a product that made extensive use of on-the-fly impersonation to access UNC folders, I found it useful to enable auditing on the target server. This gives some clue as to what resource is not accessible. Another approach is to run the SysInternals (now Microsoft) FileMon utility on the target server and look for access denied messages.

Either one of these approaches will tell you which resource requires additional permissions for error-free operations.

Nik