I've completed the update - still has the error.
I've only enabled the ibay recycle bin, the home directory worked on my other machine.
Here is some more information about the test machine,
[root@smeserver ~]# smbd --version
Version 3.6.6-0.129.el5
[root@smeserver ~]# db configuration show smb
smb=service
DeadTime=10080
KeepVersions=disabled
OpLocks=enabled
OsLevel=35
RecycleBin=disabled
RoamingProfiles=no
ServerName=smeserver
ServerRole=WS
ShadowCount=10
ShadowDir=/home/e-smith/files/.shadow
UnixCharSet=UTF8
UseClientDriver=yes
Workgroup=mitel-networks
status=enabled
[root@smeserver ~]# db accounts show testshare
testshare=ibay
CgiBin=enabled
Gid=5002
Group=testgroup
KeepVersions=enabled
Name=test share
PasswordSet=no
PublicAccess=global-pw
RecycleBin=enabled
Uid=5002
UserAccess=wr-group-rd-group
# snip from smb.conf
[testshare]
comment = test share
path = /home/e-smith/files/ibays/testshare
read only = no
writable = yes
printable = no
inherit permissions = yes
create mode = 0660
vfs objects = recycle
recycle:exclude_dir=tmp,temp,cache
recycle:repository=Recycle Bin
recycle:versions=True
recycle:keeptree=True
recycle:touch=True
recycle:directory_mode=0770
recycle:exclude=*.tmp,*.temp,*.o,*.obj,~$*,.~lock.*
Any ideas would be helpful.