MikTeX: How to run pdflatex from cmd prompt on Windows 7 compared to Windows XP?

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?

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Welcome to TeX.sx! – lockstep Oct 18 '12 at 14:27
Then you are in the wrong directory, when pdflatex is called. What is your working directory and where is the .tex file? – Heiko Oberdiek Oct 18 '12 at 14:30
My .tex file is in my "working directory" together with the auxillary files and picture files. pdflatex is located in the bin directory under the MikTeX installation directory and it is added to PATH. When running the command in the cmd promt I am in my "working directory", so I was thinking the program should look in the same directory for the auxillary files as the .tex as it does on WinXP, but apparently not on Win7? – Adam Oct 18 '12 at 14:40
I have no problem in using TeXLive or MikTeX in Windows 7 Ultimate 64 bit. – Click Me Oct 18 '12 at 14:44