I had the same problem, but recently I fixed it with this:
- Use short words, without espaces and without strange characters like "ñ", "+", "á", "ü", etc, for mxd archive, workspace, folder, mdb archive, gdb archive, target locations for ArcHydro and ApUtilities, etc.
- Remove all TMP files.
I use ArcGIS 10.0 with spanish supplement, but I avoid to use spanish characters in names.