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I think that you have another issue.
I have a Citrix Metaframe XP farm with only published applications, and the login script is fine.
The user accounts are the same that they use for their desktop logins, and the login script is the same one. The only difference is that some branches in the script are taken for Citrix logins and some for non-Citrix logins.
Although the script is now VBS it ran fine when it was KiXtart.
When you start the first published application for a session on Citrix the login process is (near) identical to a desktop login. The major difference is that explorer.exe is not started. This means that all login scripts should be executed (including usrlogon.cmd), anything in the "run" registry entries will run and if you have roaming profiles they will be copied to the server.
Subsequent applications which start in the same session don't go through the login or other startup processes, because they session is already established. If however you start a new session because you connect to a different server or the published application settings are different (audio, colour depth) then you will go through the login again.
Maybe your script is abending or failing to start.
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