bzr add fails under Windows with repository in drive root directory

I have a bzr repository in drive "S:\". Trying to add the file "S:\numbers.txt" gave the following error
    S:\> bzr add *.txt
    bzr: ERROR: No such file: u'S:/umbers.txt'
Thus when adding the root directory, the first letter of the filename has been chopped off.

This was also experienced adding a file in a subdirectory "S:\Spending\":
    S:\Spending>bzr add *.txt
    bzr: ERROR: No such file: u'S:/pending/spending2004.txt'
where again the first letter in the path after the root directory has been chopped off.

The problem disappeared when I moved the respository and all files to a subdirectory of drive S:
    S:\> mkdir s
    S:\> mv -r *.* s
    S:\> cd s
    S:\s> bzr add *.txt
    added Spending/spending2004.txt

This is using a brand new bzr installed from bzr-1.11.win32-py2.5.exe. The same error was experienced with the stand-alone version bzr-nonadmin-1.11-1.exe.