Hey Charles,
I'm actually in the middle of the exact same process as you are, but a few steps further along from the sounds of it. I see two differences comparing your process to mine however.
1.) I was told by our CAM that SQL Express is a no-no; we purchased SQL 2012 Standard Runtime (Epicor has a reasonably attractive price point for this). However, I'm not convinced that your error is caused by SQL Express vs Standard; just a heads up for future work.
2.) I'm actually running Epicor 9 and 10 on the same server, which the migration guide recommends doing. However, it's my understanding that they don't *have* to be on the same server, I just took this approach as it potentially rules out variables that could cause errors and in theory should speed the migration process.
A few things to check:
The migration needs to be ran from the E10 server, or wherever you have the E10 administration tools installed.
If you're going to stick with the separate server route, check for full administrative access between the two servers, as well as full write permissions on any directories.
Also, make sure you're using UNC paths…the migration guide is very specific on this; mapped drive letters probably won't work.
That's all I know for now, I've yet to have a successful migration as well, but my issues are with the data in the database =)
-ben