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This setting in PATH:

D:\MATLAB\R2007b\bin\win32

Here is a fresh bad affect by this setting for me:

http://stackoverflow.com/questions/2712913/why-does-this-program-require-msvcr80-dll-and-whats-the-best-solution-for-this-k

And here's an issue reported by another guy:

http://groups.google.com/group/ggobi/browse_thread/thread/dacea0fa93dcaf75

What's that setting for and why it's causing so many problems?

A: 

I'm not sure if you are talking about the PATH system environment variable or the MATLABPATH environment variable. If you mean the system environment variable, Andrew's answer seems to answer the question. Otherwise, here's some information about the MATLAB variable, in case you meant that:

The MATLABPATH variable in MATLAB tells MATLAB where to look for functions. It's analogous to the PATH system environment variable in both Windows and *nix systems (which is what Andrew was describing), but is only for the MATLAB environment.

For example, if you had a script called myScript.m stored in the C:\Users\me\Documents\MATLAB\ directory that defines the function myScript, you would be able to use your myScript function regardless of what directory you are currently working in in MATLAB.

You may modify your MATLABPATH by using the path, addpath, genpath, and other such functions.

Michael Herold
It's the `PATH` system environment variable, but there are two settings for MATLAB in `PATH`, one is `D:\MATLAB\R2007b\bin\win32`, the other `D:\MATLAB\R2007b\bin`, obviously the one in my post is not for calling MATLAB from command line.
Gtker