Cannot launch ssh from X11 system tray icon

[Craig <cygwin-xfree@cemery.org.uk>]

I have two machines, a desktop and a laptop.
Both are 64bit Windows 7 Enterprise installations.

I (think I) configured Cygwin on both the same and they have the same
identical ~/.XWinrc file.
They both use the same mirror for installing and are both fully up to date.

A précis of my .XWinrc looks like this:

menu root {
// Comments fit here, too...
"Xterm" exec "xterm"
"Xterm - Vulpix" exec "ssh vulpix xterm -e bash --login"
}

And on the desktop both work and on the laptop only the local xterm will run.
Nothing appers in /var/log/<anything>

So I added an entry like this:

"Experiment" exec ~/experiment

and ~/experiment looks like this

#!/bin/bash
(
set -x
ssh -v vulpix xterm
) > /tmp/experiment 2>&1

It still fails (i.e. does nothing) and /tmp/experiment has

+ ssh -v vulpix xterm
OpenSSH_5.9p1, OpenSSL 0.9.8t 18 Jan 2012
debug1: Reading configuration data /home/craigem/.ssh/config
debug1: /home/craigem/.ssh/config line 3: Applying options for vulpix
debug1: /home/craigem/.ssh/config line 49: Applying options for vulpix
debug1: Connecting to vulpix.uk.xensource.com [10.80.2.147] port 22.
debug1: Connection established.
debug1: identity file /home/craigem/.ssh/id_rsa type 1
debug1: identity file /home/craigem/.ssh/id_rsa-cert type -1
debug1: identity file /home/craigem/.ssh/id_dsa type -1
debug1: identity file /home/craigem/.ssh/id_dsa-cert type -1
debug1: identity file /home/craigem/.ssh/id_ecdsa type -1
debug1: identity file /home/craigem/.ssh/id_ecdsa-cert type -1
debug1: Remote protocol version 2.0, remote software version
OpenSSH_5.1p1 Debian-5
debug1: match: OpenSSH_5.1p1 Debian-5 pat OpenSSH*
debug1: Enabling compatibility mode for protocol 2.0
debug1: Local version string SSH-2.0-OpenSSH_5.9
debug1: SSH2_MSG_KEXINIT sent
debug1: SSH2_MSG_KEXINIT received
debug1: kex: server->client aes128-ctr hmac-md5 none
debug1: kex: client->server aes128-ctr hmac-md5 none
debug1: SSH2_MSG_KEX_DH_GEX_REQUEST(1024<1024<8192) sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_GROUP
debug1: SSH2_MSG_KEX_DH_GEX_INIT sent
debug1: expecting SSH2_MSG_KEX_DH_GEX_REPLY
debug1: Server host key: RSA 51:9d:01:87:94:a8:b7:ef:13:dd:89:c4:a7:2e:8b:17
debug1: Host 'vulpix.uk.xensource.com' is known and matches the RSA host key.
debug1: Found key in /home/craigem/.ssh/known_hosts:7
debug1: ssh_rsa_verify: signature correct
debug1: SSH2_MSG_NEWKEYS sent
debug1: expecting SSH2_MSG_NEWKEYS
debug1: SSH2_MSG_NEWKEYS received
debug1: Roaming not allowed by server
debug1: SSH2_MSG_SERVICE_REQUEST sent
debug1: SSH2_MSG_SERVICE_ACCEPT received
debug1: Authentications that can continue: publickey,password
debug1: Next authentication method: publickey
debug1: Offering RSA public key: /home/craigem/.ssh/id_rsa
debug1: Server accepts key: pkalg ssh-rsa blen 279
debug1: read PEM private key done: type RSA
debug1: Authentication succeeded (publickey).
Authenticated to vulpix.uk.xensource.com ([10.80.2.147]:22).
debug1: channel 0: new [client-session]
debug1: Requesting no-more-sessions@openssh.com
debug1: Entering interactive session.
Warning: No xauth data; using fake authentication data for X11 forwarding.
debug1: Requesting X11 forwarding with authentication spoofing.
debug1: Sending command: xterm
      0 [main] ssh 2184 select_stuff::wait: WaitForMultipleObjects failed
debug1: channel 0: free: client-session, nchannels 1
select: Permission denied
Transferred: sent 2784, received 2152 bytes, in 0.2 seconds
Bytes per second: sent 12596.6, received 9737.0
debug1: Exit status -1

So can anyone tell me why I get the select / waitForMultipleObjects error?

If I'm in the xterm I *can* run, I have zero problems running

$ ssh vulpix xterm -e bash --login

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