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This issue has been fixed, please download and install ArcGIS 10 Service Pack 4. SP4 includes the fixes in previous service packs and the Geodatabase Replication Upgrade Patch.
The bug is fixed by applying the replication upgrade, as explained below. It has also been fixed from Version 10 SP 1 onward, and the patch is not needed for those service packs.
Upgrading a geodatabase with replicas created at version 9.x or version 10.0 pre-release to 10 final causes the synchronization process to fail.
The following issues may occur:
• Synchronizing pre-existing replicas from earlier releases returns the following error: 'Version not found'.
• Synchronizing pre-existing replicas from earlier releases succeed and apply changes incorrectly, potentially corrupting data.
• Creating new replicas returns the following error: 'Version already exists'.
• Creating new replicas succeed but synchronization eventually starts failing with 'Version already exists'.
A mandatory software patch is available and should be applied to all ArcGIS 10 clients (ArcGIS Desktop, ArcGIS Engine, ArcGIS Server) and applied to upgrade the Enterprise (ArcSDE) geodatabase before synchronizing or creating replicas in the 10.0 geodatabase.
Patch available 07/01/10:
ArcGIS 10.0 (Desktop, Engine, Server) Geodatabase Replication Upgrade