ArcSDE for Coverages writes xx scratch files into ARCHOME by default.
These files can be redirected to a different location by setting the ARCTMPDIR environment variable.
setenv ARCTMPDIR <scratch_file_directory_path>
On Windows NT/2000:
Navigate to Control Panel > System and open Environment. Click in the System variables window and set the path for ARCTMPDIR.
To have this environmental setting take effect, you must stop and restart the service.