HI Akshara,
1. Can you make sure Explorer is at the same patch level as BI Enterprise.
2. You should think about upgrading, SP04 is very old and there are a few fixes in this area in newer releases.
3. On the same UNX can you create a Webi Report?
4. You should not have have to do this (this was only an issue on SP04 or older) but this workaround may work:
Replace this section:
-connectivity_dir "D:/Program Files (x86)/SAP BusinessObjects/SAP BusinessObjects Enterprise XI 4.0//dataAccess/connectionServer"
With this:
"-Dbusinessobjects.connectivity.directory=D:/Program Files (x86)/SAP BusinessObjects/SAP BusinessObjects Enterprise XI 4.0//dataAccess/connectionServer"