We are running the broker as a service using a non system account and cannot find any log files produced in the expected location %CA_SCM_HOME%\log
The log directory will be chosen based on the values of the HOMEDRIVE and HOMEPATH environment variables - if those variables are not set then it will use the -homedir value defined in the broker startup (command line argument or HBroker.arg value)
In practice that means whenever the broker is started from the foreground or as a non local system account service it will always use the HOMEDRIVE and HOMEPATH variable combination as these will always be set for a normal user account.
For example on Windows 2003 a normal user account would probably have HOMEDRIVE defined a C: and HOMEPATH defined as \Documents and Settings\username. This would result in the log files being created in C:\Documents and Settings\username\.cascm\log
Please note that the HOMEDRIVE and HOMEPATH would only affect the logs the -homedir broker option would still be used to locate the HServer.arg and hsvr.dfo files.