You'll probably need to convert your exe file to an msi file for distribution using a GPO. Since bginfo.exe isn't really an installer but the actual program, I don't know how that will work. You can try this exe to msi converter:
http://juice.altiris.com/download/1355/exe-to-msi

The other option is to use a script in a GPO to copy the file to their local workstations and to add a shortcut to their startup folder.

You should not need to have to run this with administrative rights.
In the bgi file, make sure the location of the file is *not* the default system32 folder, but a user specific folder (I'd recommend Application Data).
Leave out the /all as well and run bginfo simply as logon script.
Then all you have to do is copy bginfo.exe and bginfo.bgi into the netlogon folder, and use the following command as logon script in a GPO:
Script to run: %Logonserver%\netlogon\bginfo.exe
Arguments: %Logonserver%\netlogon\file.bgi /taskbar /silent /nolicprompt

oBdA: I understand what your saying but I dont get the last to lines. Can clarify?

Script to run: %Logonserver%\netlogon\bginfo.exe
Arguments: %Logonserver%\netlogon\file.bgi /taskbar /silent /nolicprompt

Ok I see what you mean now. I went into the logon script and instead of the Arguments field I had the parameters field. Thats the same thing right?

Then I can just past the two in there and be good to go?

Yes and yes.

Ok well I tried what you suggested. Create a new ou for testing this. Put myself into the ou and the created a single group policy with the logon script as you stated. I placed the two files into the netlogon folder. Once everything was set I ran 2 gpupdates and was told that some stuff can only be done at logon.

I thought this was good and everything was working until I shut down and restarted. I got to the ctrl alt del screen and put my password in. However at this point my system got hung up or at least looked like it. It got stuck in the blue screen before the start menu appeared. I waited 5 minutes and it wouldnt move. I had to shut down remove mysefl from the test ou, remove the gpo, and then finally was able to log in correctly.

It didnt like something about that logon script. The exe file is minimal in size under 500k so it should not cause a hang like that at all.

Any idea?

Basically I did it excalty like oBdA posted.

Script to run: %Logonserver%\netlogon\bginfo.exe
Arguments: %Logonserver%\netlogon\file.bgi /taskbar /silent /nolicprompt

Those were put into the two boxes available in the logon script window.

try running the following from the command prompt:

%logonserver%\netlogon\bginfo.exe %logonserver%\netlogon\file.bgi /taskbar /silent /nolicprompt

(all on one line)

If it works, create a file called bginfo.bat in the netlogon folder with the following line in it. Then change your script to be %logonserver%\netlogon\bginfo.bat instead of bginfo.exe. No arguments.

Check the application event log for Event ID 100, Source UserInit at the time you tried to log on, it might report an error.
There's a 10 minute timeout for logon scripts which can be reconfigured in a policy (don't know where out of the top of my head, and can't check it at the moment).

For testing, try it with these arguments only:
%logonserver%\netlogon\file.bgi /timer:0 /nolicprompt
This should create a background image according to the configuration of the bgi file.

Ok two things here

Victornegri: The method you described seems to work however it leaves the command prompt window on the screen until the user manually clicks out of it.

oBdA: There are no error logs in the machine. I will have to try the group policy portion of this at a later time.

put an "exit" on a separate line at the end of the batch file.

wait... try "call %logonserver%\netlogon\bginfo.exe %logonserver%\netlogon\file.bgi /taskbar /silent /nolicprompt" (with the command "call" at the beginning). Most likely it's staying open because it's waiting for bginfo to finish processing. It's never going to finish processing because it's a TSR.

Tried the method you mentioned with CALL and the command prompt still stayed open and on the screen.

If i try it with START rather than CALL in the batch script the window will disappear when I double click the bat file. However when I try to run the batch using the START logon script it doesnt work.

Try putting 2 "exit"s at the end of the batch file.

It states it on this website about the call function:
http://www.computerhope.com/call.htm

"call" doesn't help here. "call" is *only* necessary to run other *batch* files from a batch file and return control to the calling batch file afterwards.
"Exit" isn't necessary either, any command script not started through a command window will close its window automatically.
If anything, you need to create a batch file to run this in the background, so that the script doesn't wait for bginfo to end if you really require the /taskbar.
But if the background picture created by bginfo will do the trick for you, you can use bginfo.exe directly as logon script through a GPO. That's the easiest solution.
If you insist on the /taskbar, though, you can *not* use a GPO logon script, as any process started from a GPO logon script will be killed when the logon script ends.
So with /taskbar, you'd either have to create/copy a shortcut pointing to bginfo.exe into the user's Startup folder in the start menu, or use the "old" logon script method in the properties of the user in the ADUC console (enter *only* the name of the script in the netlogon folder there, no path); a process started in the background through this script will continue to run.

start "" %logonserver%\netlogon\bginfo.exe %logonserver%\netlogon\file.bgi /taskbar /silent /nolicprompt

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