Apparently, relative junctions aren’t supported by the XP/2003 version of NTFS:
Strangely, if you try the same thing on a Win 7 volume through terminal services (I used a VM in Windows Virtual PC and changed to \\tsclient\c), then it works.
(tested versions: 13.03.35 & 36)
Code:
[C:\tmp0]md foo
[C:\tmp0]mklink /j bar foo
TCC: (Sys) The data present in the reparse point buffer is invalid.
"bar"
[C:\tmp0]mklink /a /j bar foo
Junction created for bar <<===>> C:\tmp0\foo
(tested versions: 13.03.35 & 36)