First thing I would try is to run your app on a regular, non TS, 64-bit 2008 Server. Does it work?
If it does, the issue may be on the TS side of things.
In this case, try opening a command prompt before running the app and typing CHANGE USER /INSTALL. Now run it. Does it work?
Also, does it work if I am a member of the local administrators group? If it does, the issue is permissions and you can track the issue using Process Monitor from Microsoft (free).
Cláudio Rodrigues
Microsoft MVP - RDS
Citrix CTP