Windows XP and earlier profile are not compatible with Windows Vista and later profiles, hence the new profile folder with .V2 extension being created.
You can either employ folder redirection to cater for further aspects of his profile, much like you already do with My Documents, e.g. you can use folder redirection for the desktop folder any others too. However the change needs to be made in group policy and as you say 'not server heavy' this may be over complicated.
Your other choice is to get the user to log off, then manually copy the contents of the various 'important' folders in his old roaming profile folder to their respective folders in his V2 roaming profile folder, by important folders I mean desktop, favourites, cookies, MyDocs is already taken care of. You would have to take care of other profile confiurations, e.g. setting up Outlook profile, manually.
Whilst the second approach would be easier for you right now, the downside is that if he logs on to an XP machine a month down the line he will get his month old XP profile, and any changes he makes will not be seen when he logs back in to his Win7 machine, without further manual intervention from yourself. If you employ redirected folders, this aspect is not an issue.
