I've duped this on two diff. systems so far.

One in the test lab, where I upgraded the Primary domain from 7.0.3 HP3 to 8.0.1.

The other on a production system, installing a brand new domain/MTA.

In both cases:

When issuing the rcgrpwise "start" command (for the domain in question), a few seconds later, eDir is restarted (I have screenshotted where the terminal window shows ndsd being restarted). Obviously this broadcasts messages out and whacks any NCP connections you may have open.

Is this working as designed?

NetWare does not do this, only OES2 SP1 Linux (one has NSS and the other does not, although it had an NCP enabled EXT3 partition).