Microsoft Knowledge Base Article 186750 contains the following summary:
The %SystemRoot%\Sysvol folder on a Windows 2000 domain controller is used to replicate file-based data among domain controllers. Because junctions are used within the Sysvol folder structure, Windows NT file system (NTFS) version 5.0 is required on domain controllers throughout a Windows 2000 distributed file system (DFS) forest.
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