INCR Exchange Backup Fails

-1032 stands for "Cannot access file, the file is locked or in use", but I'm not sure about 0xc7ff1004. If you look around you will see number of people reporting this error. I would suggest to open this with MS support first to get understanding what is the meaning of returned code.

Below is the Event ID error and Microsoft's response. The permissions on the folder look good, however. I am going to try a couple of things over the course of the next few days. I'll post my findings if anything comes of my attempts.
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Event Type: Error
Event Source: ESE
Event Category: General
Event ID: 485
Date: 4/30/2007
Time: 4:03:36 PM
User:
Computer:
Description:
Information Store (3104): An attempt to delete the file "filename.log" failed with system error 32 (0x00000020): "The process cannot access the file because it is being used by another process. ". The delete file operation will fail with error -1032 (0xfffffbf8).
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Explanation
An unexpected error was encountered while trying to delete a file.
You will receive the following phrase in the event Description:
Information Store (number) An attempt to delete the file path\filename failed with system error [number] (hex code): [error]. The delete file operation will fail with error [number](hex code).
The file name can refer to a check file, a tmp.log file, a temp.edb file, or a temp.stm file.

The cause depends on the Error listed at the end of the Description section of the event. All known causes are listed below.
¿ Error -1032 = 0xfffffbf8 = 4294966264 = JET_errFileAccessDenied = Cannot access file - the file is locked or in use. Another process has "stolen" the file. A virus checker may mistakenly quarantine a file, or a backup process may temporarily deny access. A flat file backup system or anti-virus software may be running against the database or check file directories or the M: drive. This error can also occur if the permissions on the folder that contain the files for the information stores are not sufficient for the stores to function properly.

User Action
¿ For Error -1032. change the permissions on the folders that contain the information store files to the default permissions. Configure the flat file backup and anti-virus software to not scan the Exchange server information store subdirectories or the M: drive. Use Exchange-aware online backup and anti-virus software.
¿ NOTE: fix the root cause first. If the databases are inconsistent and you cannot run soft recovery, you may need to restore from online backup. As a last resort, you may need to repair the database with Eseutil /p, run Isinteg -fix, and then use ExMerge or Move Mailbox or .pst files to move the mailboxes to a new store, delete the current database, create a new one, and then use ExMerge or Move Mailbox or .pst files to move the mailboxes back into the blank database.