The only thing I see missing is .pl from pathext, but all that does is allow you to omit the .pl from commands. Which you aren't doing in your examples, so NP.

But, when I run your example in the manner you demonstrated, it works as you'd expect:

C:\test>type junk2.pl
#! Perl
######################################################################
+#########################################
#
#   input_demo.pl - Requires Active Perl 5.8.9 Or Higher
#
#
######################################################################
+#########################################

#require 5.8.9;         # Use Version 5.8.9 of Perl

#use lib "D:/Perl_510/lib/core ";

use English '-no_match_vars';
use File::Copy;
use IO::Handle;
use Win32;
use Win32::File qw/GetAttributes SetAttributes/;

my $runnum = 0;
my $program = 1;

        if( $runnum < 1) {
                $cwd = Win32::GetCwd();
                $prgmdir = $cwd;
        #       $prgmpth = "$prgmdir\\";
                print "\nProgram thinks it is located in the following
+ directory:\n";
                print "\t$cwd\n";
                print "if incorrect (PATH has spaces)!  Enter full pat
+h or return\n\n";
          chomp ($prgmd = <STDIN>);
                if( $prgmd =~ /^([a-zA-Z];\\).+$/ ) {
                        $prgmdir = $prgmd;
                }
                else {
                        $prgmdir = $cwd;
                }
                $prgmdir =~ /^(\w:).*/;
                $prgmdrv = $1 . ":";
        print "\nProgram:  $program, leaves you in directory: $prgmdir
+\t your input is: $prgmd \n";
        }

        RECYCLE:

        print "\nTo quit enter 0\n";
        chomp( $program = <STDIN>);

#Quit or rerun program
                if ( $program == 0 ) { exit 1;}
                goto RECYCLE;
                #exit 1;

C:\test>type junk.dat
fred
1
1
0

C:\test>junk2.pl < junk.dat

Program thinks it is located in the following directory:
        C:\test
if incorrect (PATH has spaces)!  Enter full path or return


Program:  1, leaves you in directory: C:\test    your input is: fred

To quit enter 0

To quit enter 0

To quit enter 0
[download]

The logic of your test code is a bit mixed up, (and are you aware that changing the cwd within a program will be "undone" when the program exits?), but why you are apparently seeing different behaviour to me when that code is run I cannot explain. Nor diagnose.

The only question I can think to ask: how did you install your copy of Perl? AS offer two methods: a zip file and a .msi.

In the past I tried the zip file (smaller download), but had problems -- the post unzip command file that is meant to fix-up the installation didn't complete properly and left the install in a mess. I ended up blowing the whole thing away -- include searching the registry and deleting any keys that appeared to be related, a non-recommended process not for the faint of heart -- and then installing the .msi which "Just worked". And I've used the .msi's ever since.

The symptoms of your problem seem to be very much related to your installation rather than Perl itself, and as such, you may well get better help on the AS forums than here.