i have just found and opened the file in notepad but there is nothing in the file. i have also checked the other pc where a copy of the application works fine and the file contains no data there too.

the operating system of the other pc is the same.

Did you do a search and is there no other Config.sys file?

Try opening it in Notepad and typing:

FILES=80

Then click File > Save and restart your computer.

there is no other config.sys file, i have performed the search again, so i opened the file located on C: and i have typed FILES=80. i have resterted my computer, but i still get the same error!

Have you tried using DOSBox?

DOSBox, an x86 emulator with DOS

Also see this:

Troubleshooting MS-DOS-based programs in Windows XP

It seems as though if you copy these files from the WORKING XP machine:

Ntio.sys
Ntdos.sys
Ntvdm.exe
Ntvdm.dll (Windows NT 3.1 only)
Redir.exe

You should be able to get the program working on the problem machine. That is what I would do, copy the files over from the good machine to the problem machine

Click Start > Run > type in system32 > OK

Copy the files

Paste them to either a shared folder or put them on a USB drive or CD

On the problem machine:

Click Start > Run > type in system32

Paste the files

Restart the problem PC

Hopefully it will work then

i have copied and pasted all the above mentioned files except for ntvdm.dll which is present neither on the "healthy machine" nor on the problem machine (instead there is ntvdmd.dll file on both machines), but still the same problem. i have also checked again all the files and folders contained in the application on both machines and i cannot spot any difference.