I am trying to do following:

client os = Windows Server 2003 , 32bit.

1.Backup the entire client system using backup software.
2.Boot using winpe 2.0
3.Create dynamic volume, format.
4.Restore all data to the newly created volume.

I see the Windows Server 2003 splash screen but then I see blue screen with SESSION3_INITIALIZATION_FAILURE.

I suspect this is due to differences in LDM structure between 2003 and vista.
Note: I am already using the workaround to adjust the alignment for VDS Service.
(System->Services->VDS,Alignment set to 0)

Can anyone please suggest how might I debug this issue further?