SBS 2003: Why did implementing folder redirection cause client's "desktop", "application data" to disappear...

Hi All,
The evolution of this situation occured like this:

1) I forgot all about the "My Documents Redirection" in the Server Manager > Users for starters.
2) I set group policy for folder redirection for My Docs, Application Data, Start Menu, and Desktop.  For all users, these folders would be redirected under the unc \\server1\users.
3) The 2 identical, new xp pro workstations in use performed oddly...the first pc synchronized all folders, as best as I could tell.  The 2nd pc, logged in with the same user, did not sync at all.
4)  I remembered the Server Manager > Users > My Docs Redirection and set it to redirect all users' stuff to the same path \\server1\users.
5)  Both workstations began synchronizing my documents.  It was a beautiful ting.

Here's the issue:
6)  I was explaining to my client about where stuff "lives" on his computer (one of the workstations above).  On that workstation, in c:\docs & settings\Dan (the user's name is dan) there are no Application Data or desktop folders now.  There is a Start Menu item, but it is empty.

7) I disabled the GPO for folder redirection and restarted everything, but no change.

Question:
Where are the Desktop, and Application Data items?  Would someone explain this to me.  And better yet, how to reverse this condition!!

Thanks,
Terry