Here is the configuration. Private network and domain (foo.bar). 2 file servers running 2K8R2 (file1.foo.bar and file2.foo.bar). Created a share on each server (\\file1\share and \\file2\share). Setup DFS on the domain and created a namespace (\\foo.bar). Created a folder (dfsshare) in DFS with 2 targets (\\file1\share and \\file2\share). Created the replication group and everything works except...
During testing (Win 7 SP1 x64 client) if I copy a large file (230MB) to the DFS share (\\foo.bar\dfsshare) I get the following error:
Error 0x8007003B: An unexpected network error occured.
If I copy the same file directly to one of the file servers (\\file1\share) I don't get the error and the file replicates to the other file server and shows up in the DFS share. No error when copying small files to the DFS share.
I found hotfix 983620 http://support.microsoft.com/kb/983620 but that hotfix was included in SP1 for Windows 7.
UPDATE: Narrowed it down to ~41MB file size. Above that and I get the error. Below that and it works fine. Also, network is a LAN (no routers between me and the servers) running 1000Base T.
UPDATE2: Also verified that Windows XP SP3 machines work fine so this is limited to the Windows 7 SP1 boxes.
UPDATE3: Configured the same way on our dev network and it works. Move the workstation to an OU that blocks all the DISA GPOs and it was still broke. Turned off DFS replication and it works. Turned DFS replication back on and it continued to work (very confused at this point). Put the workstation back in the proper OU and it broke again. This means it must be one of the DISA settings being applied by the GPOs. Moved the workstation back to the blocking OU and it remains broke until I turn off replication.
UPDATE4: Going through all the GPOs and we found out which one it was. It's a GPO that sets up 802.1x which seams very strange. We started googling DFS replication and 802.1x and found the real culprit. Not sure how the interaction of the 802.1x and the real culprit causes the problem (maybe someone can answer that). Anyway, if someone else answers with the correct culprit, or better yet, can explain why the interaction to the 802.1x GPO would cause the problem, I'll award the rep. After the bounty is expired I'll put the answer in here.
SOLUTION: It turns out the problem was McAfee on the workstation. We had do disable "scan network drives". Once we did this everything worked. This error only occurs when you have 802.1x configured and the DFS share is set to replicate. We now have an exception from security since the network shares are being scanned on the server. There were no errors in the windows logs or on the ePO server.
Answering my own question in the hopes it will help others. It turns out that the combination of having 802.1x configured (through GPO) and having McAfee ePO configured to scan network drives when uploading large files to a DFS share that is also being replicated will cause this error. Not sure if McAfee knows but we are trying to open a ticket with them. We got around this by disabling the scan network drives setting in ePO and this was ok with security because we have McAfee on the file servers.