Thanks Ivan, I completely understand.  It's hard to test what you can't see.  Unfortunately, I haven't been able to reproduce in a simplified project and I can't really upload the whole thing.  So, I'll give you what I can.  Remember, I'm working with 2008.1 (no hotfixes or patches) and I'm targeting the 2.0 framework with Visual Studio 2008.

Below the Register Assembly directive (I included it so you could see the version information) is the declaration for the Tree, some of the code behind and some of the javascript.  The tree is declared inside a splitterpane, which is inside an ajax updatepanel.  I'm also using a MasterPage and the page with the tree is a content page.

If you need anything else, just let me know what you want to see.  I wouldn't mind upgrading to 2008.3 if I knew it would solve the problem.  I'm just hesitant to do that as an initial step because in the past I upgraded to a more recent version to solve one problem and the newer version actually introduced a few new problems.

So, with all that in mind, take a look and see what you think.

Any assistance is certainly appreciated.

Best Regards,
Dale

<%@ Register Assembly="Infragistics2.WebUI.UltraWebNavigator.v8.1, Version=8.1.20081.1000, Culture=neutral, PublicKeyToken=7dd5c3163f2cd0cb"
    Namespace="Infragistics.WebUI.UltraWebNavigator" TagPrefix="ignav" %>

 <ignav:UltraWebTree ID="tvwAccounts" runat="server" LoadOnDemand="Manual"
    WebTreeTarget="ClassicTree" Indentation="20" CssClass="basePakInfoFont">
    <Images>                                
        <ParentNodeImage Url="~/images/folderclosed.gif" />                                 
        <LeafNodeImage Url="~/images/indexcardorange.gif" />
    </Images>
    <ClientSideEvents
        NodeClick="tvwAccounts_NodeClick"
        InitializeTree="tvwAccounts_InitializeTree" />
    <SelectedNodeStyle BackColor="#F2F2E6" ForeColor="#FF5500" Font-Bold="True" />
</ignav:UltraWebTree>

The code below gets called from PageLoad if it's not a postback.

    Private Sub InitializeUI()
        If Page.Request.QueryString("countryId") IsNot Nothing AndAlso _
           Page.Request.QueryString("countryId") <> Guid.Empty.ToString Then
            For Each countryNode As Node In tvwAccounts.Nodes
                Dim tag As ExplorerTag = DirectCast(countryNode.Tag, ExplorerTag)
                If tag.NodeType = ExplorerTag.NodeTypes.Country AndAlso _
                    tag.RootNodeValue = New Guid(Page.Request.QueryString("countryId")) Then
                    If Page.Request.QueryString("territoryId") IsNot Nothing Then
                        loadNode(countryNode)
                        For Each territoryNode As Node In countryNode.Nodes
                            Dim territoryTag As ExplorerTag = DirectCast(territoryNode.Tag, ExplorerTag)
                            If territoryTag.NodeType = ExplorerTag.NodeTypes.Territory AndAlso _
                                territoryNode.Text = Page.Request.QueryString("territoryId") Then
                                If Page.Request.QueryString("accountId") IsNot Nothing Then
                                    loadNode(territoryNode)
                                    For Each accountNode As Node In territoryNode.Nodes
                                        If accountNode.Tag.ToString = Page.Request.QueryString("accountId") Then
                                            loadNode(accountNode)
                                            tvwAccounts.SelectedNode = accountNode
                                            If Page.Request.QueryString("quoteId") IsNot Nothing Then
                                                For Each pakRow As UltraGridRow In grdPaks.Rows
                                                    If pakRow.Cells(0).Value.ToString = Page.Request.QueryString("quoteId") Then
                                                        pakRow.Selected = True
                                                        pakRow.Activate()
                                                    End If
                                                Next
                                            End If
                                            Exit For
                                        End If
                                    Next
                                    Exit For
                                Else
                                    loadNode(territoryNode)
                                    tvwAccounts.SelectedNode = territoryNode
                                    Exit For
                                End If
                            End If
                        Next
                        Exit For
                    Else
                        loadNode(countryNode)
                        tvwAccounts.SelectedNode = countryNode
                        Exit For
                    End If
                End If
            Next
        End If
    End Sub

    Private Sub loadNode(ByVal selectedNode As Node)
        If selectedNode.Tag.GetType Is GetType(String) Then
            GetAccountQuotes(New Guid(selectedNode.Tag.ToString))
            BindToGrid()
        End If
        ' Here we need to expand or contract the
        ' tree as necessary.
        If selectedNode.ShowExpand Then
            If selectedNode.Expanded = False Then
                If selectedNode.Nodes.Count = 0 Then
                    If selectedNode.Tag.GetType Is GetType(ExplorerTag) Then
                        Select Case DirectCast(selectedNode.Tag, ExplorerTag).NodeType
                            Case ExplorerTag.NodeTypes.Country
                                LoadTerritories(selectedNode)
                            Case ExplorerTag.NodeTypes.Territory
                                LoadAccounts(selectedNode)
                        End Select
                    End If
                End If
                selectedNode.Expand(False)
            Else
                selectedNode.Collapse(False)
            End If
        End If
    End Sub

Here is some of my javascript code.

var accountTree;

 function tvwAccounts_InitializeTree(treeId) {
    try {
        accountTree = igtree_getTreeById(treeId);
    }
    catch (ex) {
        alert('Error in Tree initialize' + ex.message);
    }   
}

function tvwAccounts_NodeClick(treeId, nodeId, button) {
    //Add code to handle your event here.
    try {
        //alert("nodeclick");
        if (!nodeId || !treeId || !button) return null;
        if (button == 2) {           
            var node = igtree_getNodeById(nodeId);
            if (node && accountTree) {
               
                // Initialize menu for working with the tree.
                var menuItems = new Array();
                menuItems = mnuQuoteContext.getItems();
                loadMenuForTree(menuItems);
                              
                // Account nodes will have an account id stored in its tag.
                // All other nodes (ie country and territory) will have a null tag.
                var tag = node.getTag();
                if (tag) {
                    accountId = tag;
                    quoteId = null;
                    // We need to ensure menuitems are enabled for account nodes.
                    for (var i = 0; i < menuItems.length; i++) {
                        if (menuItems[i].getElement().style.display == 'block') {
                            menuItems[i].setEnabled(true);
                        }
                    }
                    if (tag == '00000000-0000-0000-0000-000000000000') {
                        menuItems[0].setTargetUrl('CreateQuote.aspx');
                        hideMenuItem(menuItems[7]);
                        hideMenuItem(menuItems[9]);
                    }
                    else {
                        menuItems[0].setTargetUrl('CreateQuote.aspx?AccountID=' + tag);
                        var id = tag.split('-');
                        var idWithOutSeparators = '';
                        for (var i = 0; i < id.length; i++) {
                            idWithOutSeparators += id[i];
                        }
                        showMenuItem(menuItems[7]);
                        showMenuItem(menuItems[9]);
                        menuItems[9].setTargetUrl('Accounts.aspx?action=edit&id=' + idWithOutSeparators);                       
                    }
                   

                    //these will need to be implemented at some point
                    menuItems[6].setEnabled(false);
                    menuItems[11].setEnabled(false);
                }
                else {
                    // Menuitems should only be enabled for account nodes, so
                    // we disable all visible nodes for country or territory nodes.
                    for (var i = 0; i < menuItems.length; i++) {
                        if (menuItems[i].getElement().style.display == 'block') {
                            menuItems[i].setEnabled(false);
                        }
                        //menuItems[0].setTargetUrl('CreateQuote.aspx');                     
                    }
                }
                // Cancel the show of IE context menu
                event.returnValue = false;
                event.cancelBubble = true;
                igmenu_showMenu(mnuQuoteContext.MenuName, event);            
            }
        }
    }
    catch (ex) {
        alert('Error in Treeview Click' + ex.message);
    }
}