John, it is a regression in the future version, which we hope will resolve w/o intervention from you.
The bug is in the LZMA decompression code which gets run after the current version of Omaha discovers the update, and runs the payload with --update. When the decompression runs, the bug makes it access its current working directory to extract the contents of the archive. Due to how RPC works, the O4 server process inherits the Windows system directory as its `cwd`, therefore, the self-decompression fails.
Because of an unrelated regression, we ended up prompting with `57` instead of silently ignoring.