We redirect the application data folder to the server using folder redirection and then use a default profile in the netlogon folder to provide basic application settings. The desktop and start menu is provided by using folder redirection as well. We only give staff a redirected profile the students get a new profile at each logon which is much faster and lower load on the server.
We use this in our logon script to change the faves location
WSHShell.RegWrite "HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\User Shell Folders\Favorites", "U:\Favorites", "REG_EXPAND_SZ"
WSHShell.RegWrite "HKEY_CURRENT_USER\Software\Microsoft\Windows\CurrentVersion\Explorer\Shell Folders\Favorites", "U:\Favorites", "REG_SZ"