Out of curiousity: does it work even if you're on a different hard drive/directory as the installation drive/directory? The intent of that batch file is to allow you to launch Arc from anywhere, while still (1) able to access the current directory and (2) able to load library files from the arc installation directory
E:\> copy con tmp.arc
(prn "hello world!")
^Z <---- that's a control-Z
E:\> "C:\User\Programming\Arc\arc3f\arc-f\arc.bat"
Use (quit) to quit, (tl) to return here after an interrupt.
<User>tl: (using <files>v1)
t
<User>tl: (ls)
("tmp.arc") <--- you should get a list of files and stuff in the current directory, including tmp.arc
<User>tl: (load "tmp.arc")
hello world!
nil
<User>tl: