Test this out on your system, put the license.txt (ANSI-TXT) in your Disk1 and then edit the code below to match the bottom... this way we know your source and there is no logical reason why it wouldn't be working... step through and let me know what your results are... it sounds to me that the text file is being lost, or at least its location is..
szLicenseFile = SRCDIR^"license.txt";
nResult = SdLicense( szTitle2, szMsg2, szQuestion, szLicenseFile );
if (nResult = BACK) goto Dlg_SdWelcome;
...PS: According to IS:"The text in szLicenseFile should contain hard returns after lines with more 1,024 characters. The text from this file is read into string lists at 1,024-byte intervals. If the text from szLicenseFile does not contain hard returns, the words may wrap inside the SdLicense dialog box with unexpected results. "