I recently worked with a problem with a powershell bug described over at lee holmes blog here, but when trying to implement the solution he suggested, i still had problems. As it turned out my script was generating errors and Lees blog only describes how to amend the errors with regards to standard output. When it comes to standard error, there is a similar fix to the problem. Here is what i added to the profile of the server that i had problems with.

First the fix suggested by Lee Holmes

$bindingFlags = [Reflection.BindingFlags] "Instance,NonPublic,GetField"
$consoleHost = $host.GetType().GetField("externalHost", $bindingFlags).GetValue($host)
[void] $consoleHost.GetType().GetProperty("IsStandardOutputRedirected", $bindingFlags).GetValue($consoleHost, @())
$field = $consoleHost.GetType().GetField("standardOutputWriter", $bindingFlags)
$field.SetValue($consoleHost, [Console]::Out)

and then my own addition to this, to make the same fix for stderror output

$field2 = $consoleHost.GetType().GetField("standardErrorWriter", $bindingFlags)
$field2.SetValue($consoleHost, [Console]::Out)

This was for version 1.0 of powershell. Now for CTP2.

$bindingFlags = [Reflection.BindingFlags] "Instance,NonPublic,GetField"
$objectRef = $host.GetType().GetField("externalHostRef", $bindingFlags).GetValue($host)

$bindingFlags = [Reflection.BindingFlags] "Instance,NonPublic,GetProperty"
$consoleHost = $objectRef.GetType().GetProperty("Value", $bindingFlags).GetValue($objectRef, @())

[void] $consoleHost.GetType().GetProperty("IsStandardOutputRedirected", $bindingFlags).GetValue($consoleHost, @())
$bindingFlags = [Reflection.BindingFlags] "Instance,NonPublic,GetField"
$field = $consoleHost.GetType().GetField("standardOutputWriter", $bindingFlags)
$field.SetValue($consoleHost, [Console]::Out)

And the additions again for stderr is actually the same for CTP2

$field2 = $consoleHost.GetType().GetField("standardErrorWriter", $bindingFlags)
$field2.SetValue($consoleHost, [Console]::Out)

After implementing this i was able to actually see the errors my script was generating. I will spare you of the embarrassing details  

Enjoy!