Well, I'll be damned...

Apparently if I log-in with the same user name that the one who is running the server, then no registration of the dlls are needed, but if it is a different user, then the dlls should be registered in the client computer. This took longer to find out for in one of the earlier tests, we register the wrong dll, and this coupled with the fact that I was able to run the client in several other computers where I did not register the dlls hide the real problem. Now the system is working for different users.

I need a vacation....