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Hi Raymond,
If i then go to a machine where computername ends with Y and I run the %TEST% in a command prompt it shows \\servername\folderY as the value for that variable.
So that means that DEM correctly sets the variable.
If you mean that the DEM agent does not expand env vars references in the Arguments field of a shortcut definition, that is correct. However, Windows does that when you invoke the shortcut.
That is, if I define a shortcut as follows:
it will behave like this:
Although Arguments is not "pre-expanded" by the DEM agent (unlike the shortcut name, for instance), Windows does that while launching the shortcut's target. As the Command line column in Task Manager shows, it's not Notepad.exe itself that is performing the expansion.