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(a) Does running a simple non-HG command work? Permissions on cmd.exe will
affect out-of-process python hooks.
(b) Does a simple hook like '"python -c "import sys; sys.exit(0)"' work?
(c) If you make it this far, can you confirm that the process is running as the
user you think it's running as, with a hook that does something like:
    import win32api
    username = win32api.GetUserName()
    (write username to a file so you can read it)

-Ezra