After you've disabled the on-demand access (you can do that for the working 
copy folder alone), you have to wait a while until *all* files (including 
those inside the usually hidden .svn folder!) show the green overlay (see 
the link to the blog post you just posted, there are images on how that 
overlay has to look).
Meaning: all files have to be locally available immediately.

The reason some apps can work with those on-demand files and not TSVN is 
that TSVN is a shell extension, and if a shell extension takes too long for 
a specific task, the explorer will kill it to prevent the whole 
explorer/desktop from freezing. That's why TSVN won't work with on-demand 
files: it takes too long to fetch them and so the explorer process just 
stops the shell extension part of TSVN.

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