Specifies whether Terminal Services uses the specified network share or local directory path as the root of the user's home ...

Windows Server 2003

"Specifies whether Terminal Services uses the specified network share or local directory path as the root of the user's home directory for a Terminal Services session. 

To use this setting, select the location for the home directory (network or local) from the Location drop-down list. If you choose to place the directory on a network share, type the Home Dir Root Path in the form \\Computername\Sharename, and then select the drive letter to which you want the network share to be mapped. 

If you choose to keep the home directory on the local computer, type the Home Dir Root Path in the form "Drive:\Path" (without quotes), without environment variables or ellipses. Do not specify a placeholder for user alias, because Terminal Services automatically appends this at logon. 

Note: The Drive Letter field is ignored if you choose to specify a local path. If you choose to specify a local path but then type the name of a network share in Home Dir Root Path, Terminal Services places user home directories in the network location. 

If the status is set to Enabled, Terminal Services creates the user's home directory in the specified location on the local computer or the network. The home directory path for each user is the specified Home Dir Root Path and the user's alias. 

If the status is set to Disabled or Not Configured, the user's home directory is as specified at the server."

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