I have problems with an HP t5000 X station, acting as a thin client and connected via TCP and xfce shell to a Red Hat Linux server. When I open a simple text file in 'emacs' the characters are translated to boxes. In 'vi' I have no problem, but the problem is not only related to 'emacs' as we have the same "character" problem using the GUI from a commercial application. It doesn't matter if I'm root or normal user. Opening the textfile using ssh from a thick client works fine. I'd appreciate if someone can help me on this.

You don't have the correct font set on the thin client then would be my guess. Without knowing more I can't guess direction to go. Normal answer is to install fonts but you might have to change the x client (remember it is backwards) settings in RH to match thin if embedded. "Best Practices", Event viewer, host file, perfmon, antivirus, anti-spyware, Live CD's, backups, are in my top 10