Hi Mike,
Since you've already verified this on the same board with the standard serial connection/cable, it could be that the board you're plugging the USB/Serial adapter into is routing some handshaking signals back to the standard DB-9 type serial adapter on the board.
This may or may not be a good thing depending on the USB/Serial adapter, how it's wired, and what signals it makes available at the DB-9 end.
I would check this one out first. If you have another PIC dev board with a DB-9 connector that's not wired for looping back signals/handshaking that would tell you.
This message just means the loader software running on your PC can't communicate with the target PIC. If the boards DB-9 wiring is OK for the adapter, and you're selecting the adapters "virtual" serial port, it should work.
It could also be sloppy timing or drivers on the converter. I have never had any problems with USB/Serial adapters using the FTDI chipsets, but I have with several other el-cheapo brands. Especially on XP systems.
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