The "specified directory" directory is the one where Auto Update goes to get the DAT files. See event id 4011 from source McAutoUpdate for more details.
We also received this very same error on our servers (running NetShield). We had one central server that gets the latest DAT files off the Internet, and then all our other servers pull the DAT files from that server. We changed the name of that server, so the others could no longer find it, to update their DAT files. Therefore, every day right after NetShield "AutoUpgrade" started we would get this error.
Message generated by McAfee agents on servers. This message is generated even if logging is disabled or there is no limit for log files. We did manage to go around though - we simply put an automatic task to delete the logs! Please note that I have centralized logging so I really don't care about the log files. You may want to move the logs to some other place just in case you need them.