To add to Mike's post, the 255 limit has been there forever in 32bit Win. There is no difference in it's handling to XP or Vista. I've just tested a 255 path on 7 and it's just fine. Everything about your problem suggest it's not a Microsoft issue. You clearly know your way around Windows. I would suggest that a methodical troubleshooting approach will find the problem.
PS. Subst is an easy workaround for the 255 limit.
PPS. The childish "Microslop" type comments are not going to be helpful in getting folks to try to help. If .001% of Windows users have an issue with something, then you will find 1000's of posts from people screaming about how Microsoft need to do something. They usually do not.