So you might try setting up another test system for comparison and see if it acts any differently on another system. There was a bit of a lag in some places and some studdering while typing but not too bad. I didn't try printing anything, but screen performance was reasonably good. As a test, I ran a copy of Wordstar 6 as a seamless application on my newer test system. I no longer have the original test machine to do any comparisons against (it was the same hardware for both tests). I didn't knowingly do anything different on the two Win7 machines, but the results were dramatically different.
In both cases, as you found, the performance in a full machine mode was fine and the slow down only occured in seamless application mode (and only on the one machine). But on my latest test system, the performance of the DOS application is fine. It's odd, I saw the same extremely slow performance that you mention on the first test system I set up with XP Mode.
I'm in a similar situation, but in my case it's running a DOS applications on an 圆4 system where DOS support has been removed by Microsoft. Not to run legacy Windows apps, but rather to run some old DOS apps we still use Either way, I've looked at every single option I can think of, and just wondered if anyone has come up with a work around? I'm going to try and make Microsoft aware of this problem, although as they want so dearly for DOS to be history (which granted, it largely is) I suspect they might not fix this. So I would assume there must be a bug somewhere in the seamless virtualised application layer, or indeed the way apps are called up individually through the RDP protocol. Please, no comments about why we are still having to run these dinosaurs, it is far too long a story! Interestingly, if I load up the virtual machine fully in Windows 7 (not in application mode) and run these DOS applications, they work flawlessly. We are trying virtualise 2 DOS apps - WordStar & dBase. They function in every way I want them to, but if I type a line of text inside one of these apps, it will take 10 seconds to slowly appear.
I have been able to get our DOS apps to virtualise and run in this way, but they are desperately slow when running in virtual application mode.
We have an unusual use for this software though - not to run legacy Windows apps, but rather to run some old DOS apps we still use that work in Windows XP, and no higher. Despite much of the negative feedback, I think it works quite well for it's primary purpose of seamlessly virtualising legacy apps for businesses. I am currently trialling the RC1 release of Windows 7, and as part of my testing have set up and am trying out the XP Mode virtualisation. This is a question that I doubt many can shed light on, but here we go.