John,
As this is a Test and Destroy type installation; there will be no attempts at remedy of any issues discovered.
At this time it appears that the ill effects are limited to some but not all of the XML reports in the 2008 version not working, this has no impact on same reports in 2009. Lucky for me this is a Training and Education experiment, not a production environment, so IF they never play well together that will be OK right up until I write ZEROS to that drive and move on.
Thanks for the input and will keep in mind should there be a need to actually 'solve' this issue.