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Interactive (in the old scheduler at least) meant that it would "appear" on the console if a user logged in.
This is vital for things like ntbackup, as if this gets stuck for any reason - no tape in drive for example - it will just hang with a prompt. The next night it will fail to start because there is already a hung process running.
If you don't use the interactive switch it remains stuck in the background with no clue about what is going on.
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