One thing I think we've lost track of in this thread is that the question is 
about Windows Flashbackup.  

The ALL_LOCAL_DRIVES directive is not supported in Windows Flashbackup policies 
(see p81 of the Advanced Client System Administrator's Guide) so all the talk 
about exclude lists, etc are moot for this setup.

You must specify the local drive letters- ALL_LOCAL_DRIVES is simply not 
available under Flashbackup policies.

Tom

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