>The real problem we are having is the inconsistentcy of "EXCLUSIVE ON|OFF". Sometimes the SQL Select results in a file which has EXCLUSIVE ON sometimes it results in a file with EXCLUSIVE OFF. This generates a random error indicating that we must have exclusive use of the file to accomplish desired results. Using SET EXCLUSIVE has no effect. Its almost like the EXCLUSIVE status is being embedded in the file header with no way to change it or predict its value.

Well, probably you right, though I've always believed that Select-SQL creates exclusively opened tables. It's may be the case when Select-SQL overwrites dbf which was already open in shared mode.
Actually, I've never cared about this issue because I used to create temporary tables for local usage (using SYS(3) as a name) and stationary shared tables for network usage.