In this case the application which sets the environment variable is executed in/from the application that needs to access the env.var. The Main() Return Values (C# Programming Guide) msdn article discusses its use within a batch file. If I try the same, everything is fine; but what is required is to run not from a batch script but from within an application.
Process.Start("app","args"); // app sets the env.var.
string envVar = System.Environment.GetEnvironmentVariable("ERRORLEVEL");
was obviously unsuccessful. Process.Start made the "app" work in a completely different environment I believe. In other words, I need to run "app" in the same environment as the caller application in order to reach the environment variable it sets.