AIE (Application Isolation Environment) and Application Streaming share some of the same files because Application Streaming was built on underlying AIE technology. Because of this, applying a hotfix or a hotfix rollup pack can cause stability issues with Application Streaming. Likewise, upgrading to a newer version of the Citrix offline plug-in can cause AIE stability issues.
AIE support has been discontinued in XenApp 5.0 for Windows 2008. The best practice for isolating applications going forward is to use Application Streaming.
AIE:
AIE allows an application to run in an isolated environment by installing the application files and registry keys within AIE instead of the various folders or registry hives in the operating system itself. This allows older applications, incompatible applications, and multiple versions of the same application to be published for users.
Note: Installing Version 6 of the offline plug-in on a XenApp 5.0 for Windows 2003 server causes applications using AIE to no longer function properly.