Re: shell problems after upgrading NTEmacs from 19.34 to 21.2

[swengtoo@my-deja.com (Swengtoo)]

maierh@myself.com wrote in message news:<uiszr3v9i.fsf@myself.com>...
> 
> You should try this within the '*scratch*' buffer with
> 
>   emacs -q 
> 
> Shell handling has changed from emacs-20 to emacs-21. You only need 
> the SHELL environment variable or set the variable shell-file-name.
> 

Thank you so much for the breakthrough in troubleshooting this.
Indeed, I invoked 'emacs -q' and in the *scratch* buffer I typed:

(setenv "SHELL" "/bin/sh.exe")

and then executed <M-x shell> and bingo - it worked!

But now I need to know why the same statement wouldn't work from my
.emacs - is it possible that evaluation stops prior to reaching this
statement (again, only in 21.2, not in 19.34...). If this is the case,
then I am even more puzzled since I encapsulated my original .emacs
within the following:

(setq debug-on-error t)
< original .emacs >
(setq debug-on-error nil)

to enable debug - and emacs does not report ANY errors.

What am I missing here?

Thank you so much!
Swengtoo