In Windows XP I create my test.tex in emacs and then run it in the cmd promt as pdflatex test.tex in the corresponding directory, and it works without a problem. However, in Windows 7 doing the same thing I need to use the full file path in the cmd promt pdflatex "...dir/test.tex" and then it runs but stops because it can't find the test.aux file, probably since the program looks for it in the current directory where the test.tex file is located.
How can one do this in Windows 7?

pdflatexis called. What is your working directory and where is the.texfile? – Heiko Oberdiek Oct 18 '12 at 14:30