Permissions is one possibility. The other two I can think of are:
a. if you're actually working on a Windows 2003 server box (i.e. running
Word on it) then there may be a problem if the folder containing the data
source is not trusted by IE. That may be a WOrd 2002-only problem, but for
further info. see

http://support.microsoft.com/kb/834699/en-us

b. (most likely of all I suppose) if the full path name of the file is
longer than when the file is sitting on your c:\ drive there may be
problems. When that happens, it's not because the Name parameter to your
OpenDataSource call is too long, but because for many types of data source,
Word builds a connection string (even if you don't provide one). If for
example, it's an OLE DB Jet provider connection string, it will contain
either the path name of the containing folder or the full path name of the
file you're trying to open. If the connection string exceeds 255 characters,
Word may truncate it at a point that makes the string invalid and causes the
method call to fail.

As for the pemissions issue, it's not an area I'm particularly familiar
with, but just because a user has full admin rights does not necessarily
mean that they have a right to do /everything/, e.g. create files in a
read-only folder. Nor is a full admin user's permissions necessarily a
superset of other users' permissions - for example, an admin may have no
rights to a folder created by a non-admin. They may be able to take
ownership and/or grant themselves the rights (I don't know) but that ability
wouldn't actually give them the permissions they need right now.

In this case if the folder was created by a domain admin, and you're logged
in as a domain admin when you try to connect to the data source, then I'd
say it's likely the user has the necessary permissions and the problem lies
elsewhere. But I'd still go to the machine where the relevant folder
resides, open its parent folder, right-click on the folder, open the
properties then the security tab and see what permissions the admin user
actually has, just to be sure. Alternatively, you might be able to create a
new folder on the server, assign all the necessary permissions there, put
your data source in there and try that.

From what you said, you're not using shares, but if you are, the permissions
on the share may be different from the permissions on the underlying folder.

FWIW my own experience in this area is also with a Win2003-based server. I
don't remember having problems with my shared folder on the server box
itself (but it's a long time since I set it up) but there have definitely
been permisions problems with folders on other machines in the domain.

If it isn't any of those, I don't know what the problem might be.

Peter Jamieson