Thanks Raphael for your reply.
The watch log does not appear to be writing any "errors" during this time. Here is a copy of the section of the log which corresponds with the time of the Windows Event error message above:
(The Windows Event shows the Watch Service 'hung' at 02:39:14, then 9 seconds later at 02:39:23 that the Watch 7 service started successfully.)
------------------------------------------------------------------------
WPROC: AF-Master - 02:35:40
INFO : File created : C:\Documents and Settings\All Users\Application Data\Objectif Lune\PlanetPress Suite 7\PlanetPress Watch\Spool\4.tmp\job00ZEAJ9GL1S1F42C38BD0.dat, size: 25 bytes
INFO : Plugin Create File completed successfully - 02:35:40
INFO : File processed : job00ZEAJ9GL1S1F42C38BD0.dat, size: 311 bytes
INFO : Plugin PlanetPress Database completed successfully - 02:35:40
INFO : Splitting 1 records and/or 1 pages per split
INFO : No pieces left.
INFO : Plugin Database Splitter completed successfully - 02:35:40
WPROC: AF-Master complete - 02:35:40
INFO : Signaling Process "Internal Dynamic Process" to stop (8 of 8)...
INFO : Signaling Process "FailedFax" to stop (7 of 8)...
INFO : Signaling Process "Process1" to stop (6 of 8)...
INFO : Signaling Process "AF-Master" to stop (5 of 8)...
INFO : Signaling Process "PrinterPB" to stop (4 of 8)...
INFO : Signaling Process "PrinterPA" to stop (3 of 8)...
INFO : Signaling Process "P2" to stop (2 of 8)...
INFO : Signaling Process "P1" to stop (1 of 8)...
INFO : Waiting for Processes to terminate (8 process left)...
DEBUG: Process "P1" is still running...
DEBUG: Process "P2" is still running...
DEBUG: Process "PrinterPA" is still running...
DEBUG: Process "PrinterPB" is still running...
DEBUG: Process "AF-Master" is still running...
DEBUG: Process "Process1" is still running...
DEBUG: Process "FailedFax" is still running...
DEBUG: Process "Internal Dynamic Process" is still running...
INFO : All Processes have terminated.
INFO : Service has stopped
STOP : 2011/02/09 02:36:36
=======================================================================
=======================================================================
START: 2011/02/09 02:37:41
INFO : PlanetPress Office v7.2.3.5964
INFO : Host: CPS-DDMS; User: Administrator
INFO : Serial number: USI6O-472141-7306; Activation code: 0260-472141-6B79-562D-DB2D-09D3
INFO : Starting helper "PPFax7"...
INFO : Starting helper "PPImage7"...
INFO : Service has started
------------------------------------------------------------------------
WPROC: AF-Master - 02:39:23
INFO : File created : C:\Documents and Settings\All Users\Application Data\Objectif Lune\PlanetPress Suite 7\PlanetPress Watch\Spool\4.tmp\job00ZEAJAHH1H3C1C22FEF.dat, size: 25 bytes
INFO : Plugin Create File completed successfully - 02:39:23
INFO : File processed : job00ZEAJAHH1H3C1C22FEF.dat, size: 311 bytes
INFO : Plugin PlanetPress Database completed successfully - 02:39:29
INFO : Splitting 1 records and/or 1 pages per split
INFO : No pieces left.
INFO : Plugin Database Splitter completed successfully - 02:39:29
WPROC: AF-Master complete - 02:39:29
------------------------------------------------------------------------
The administrator of this server is not positive the exact version that was installed previous to the upgrade to 7.2.3, however they do regularly check and install any updates on a weekly basis so I'm comfortable saying that whichever version was current one week previous to the release of 7.2.3 was the installed version. They also added that they upgraded only, and did not make any changes to the config.
I've also verified that the Watch service starts using the same, Administrator-level user account that is logged into Windows on startup.
Just to reiterate, the issue is not so much that the Watch service does not startup, but that on the initial attempt Watch 7 service appears to be hanging, which is causing a Windows error message to display. Each time this happens, we do see that the service successfully starts within 10 seconds of the initial hang.