As for your CR/LF problem, it seems like you have been Oracled (bad thing, obviously...) :
At the time of this writing, there are no workarounds nor is Oracle considering back-porting a fix for Oracle9i.
You could gain more insight by delving into these Ask Tom answers. In your case, I guess developing a Java package would be an option worth being considered.
Given what you are doing with the data (ie trying to remove it from the database) what is the feasibility of copying the table (as BLOBs) to a later database version (or a linux or other non-windows version). Then you can run the extract from there.
We had a strange one with this trying to handle MAC output, which just uses CR's.
We loaded a file with just CR's to the database as a BLOB, this was okay.
When we tried to write it out from the BLOB it errored with the same code you got!
Solution was before inserting into the blob replace all CR to CR LF.
Then interestingly when Oracle writes it out (DB is on UNIX), it just writes out LF's.
We then replace of LF's with CR's in the actual output file before delivering the the user!