Relative Path issue in 6.5

I am having a problems with a relative path using Visual Studio Runner and MSBuild Runner.

We are building a WebService component to act as a front-end to AS/400 and Sharepoint 2010.
The WebService component is built on .Net 4.0 and references three modules written in .Net3.5 from the Sharepoint project.
One of the three modules keeps throwing a compile error saying the "..\..\<path>file.csproj cannot be found".
The directory exists and is pathed correctly.
I first had the problem when running the Solution, and tracked to the specific project calling the Sharepoint module.
I re-ran using the MSBuild runner against the .csproj - same issue.
The build compiles locally, the root is a common root from Team Foundation Server (both projects are from the same root), and I can find no problem with the project or solution.

Anyone seen something like this before?

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Please try to open checkout directory right on build agent machine, and lauch MSBuild interactivelly from there.
If that does not help, post the build log with compilation errors, and file listing for this checkout directory (by dir /s /b).


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