Option 43 was built as a string variable and not a binary variable. This we determined by the by looking at the offer from the DHCP server. Option 43 was present in the offer as you would expect in with PXE force mode enabled. However, the value for option 43 was not valid based on what would be expected from the PXE Force Mode utility. You'll need to delete the option 43 and recreate it making sure that it is built as a binary variable and not a string variable.
This being a Lucent QIP - they added square brackets in option 43 to encapsulate the hex data which resolved the issue.
DS 6.8 SP1
PXE and DS on same box
Lucent DHCP in separate subnet from DS/PXE and from client
PXE Forced mode
IP helper forwarding DHCP requests to the DHCP server