I have a MOSS 2007 publishing instance and I am trying to create variation
hierarchy for multilingual sites.

The operation abruptly fails with the following error message

"An error was encountered performing this operation.

You may re-try the operation, and you may need to clean up the half-created data
first before re-trying. If the problem persists, please contact your system
administrator."

Additionally when I look at the log file some of the relavent entries that I see
are the following

LRO - An exception was thrown by the DoWork method of a LongRunningOperation
System.IO.IOException: The directory is not empty.

LongRunningOperationJob.UpdateStatus(): Failed, this=57612464