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When attempting to deploy files via Group Policy Preferences, there is a well-known issue wherein you may receive an error to the effect of: 0x80070003 The system cannot find the path specified. This is due to the local system being the security context used to deploy the file. If the local system does not have rights to the location, as is true with mapped drives, access is denied and the path cannot be found. The workaround for this is to enable the common option "Run under the logged in user's security context"

However, I have done this and still receive the same error. I have verified the logged-in user can reach both the source and destination. Specifically, the source is a file server and the destination is the user's HOMEPATH, which resides on another fileserver in this case. More to the point, it's their redirected Documents folder, and it otherwise works fine; I cannot imagine this being a permissions or connectivity issue, especially because I receive the error even if I execute a gpupdate /force /target:user while logged in.

I've also installed the hotfix from Microsoft pertaining to this issue: "Error code 0x80070003 when a Group Policy preference is applied to Windows 7 clients", but this did not change anything. (I only installed it onto the desktop; that seems to be where it belongs for my case.)

I'm at a loss as to why this happens. The domain controllers agree the common option is set, and a gpupdate does otherwise succeed. Also, if I change the target to a location on a local drive of the computer, it works fine. I do not see the common option reflected in the output of gpresult, but I'm not sure if I should.

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Have you ensured that you're using the right variable as the destination folder? Because policy processing runs before the user's environment is loaded, user variables like %HOMEPATH% are not yet available. If you place your cursor in the destination folder box and press F3, you'll get a list like the one below. These are very different from the 'normal' environmental variables, and are the ONLY ones that work in group policy preferences.

Group Policy Preferences Environmental Variables

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    I hate it when people leave a question unattended and unanswered when others are so kind as to provide valuable thoughts and context. I hate it more so when the negligent asker is me. IIRC, this was indeed exactly the issue. – Tohuw Dec 17 '16 at 8:24
  • Haha it's all good; glad this resolved your issue, and thanks for the upvote/accept! – tfrederick74656 Jan 5 '17 at 2:29

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