Internal Server Error 500, Exception: EDBEngineError,Message: Directory is busy

We have created an Web App using Delphi 5 and the paradox database. In order
to communicate with the database we are using TQuery's and TTables, and a
TSession and TDatabase. We would like to use the App with MS SQL 7, however
after having setup the ODBC Alias, when we try to run the app we get the
error message:-

Internal Server Error 500
Exception: EDBEngineError
Message: Directory is busy.

The MSSQL 7 Server is the same machine that is running IIS(4), and the
Delphi Web App. The op system is NT4 Server Sp6a.
We are aware that it would probably be better to use ADO but this will
involve a great deal of work and we are very pushed for time.
Has anyone got any ideas please?