I guess our posts crisscrossed. You are right. Everything looks all right on the Oracle side. But then again, there is a registry entry for ORACLE_HOME in the registry (HKLM\SOFTWARE\ORACLE\KEY_OraClient10g_home1) as well. So, we can't tell for sure.
I believe, PB talks to Oracle through the OCI.dll. May be the first install put it somewhere that is in the path (like windows dir?).
SQLNet Tracing would have helped, if it worked.
If you want, you can try renaming client_1 to something else temporarily and try (tnsping, pb) to eliminate the possibility. If that seems to work, then uninstall client_1 completely.
Other than that, Clean re-install (uninstall both client1 and 2 then install) may be your best option. You may want to make sure PB connects, before the network guy goes away 
. Good Luck!