another idea - there are several zip.exe's in some packages called unix-utils for win32 or similar name
are you sure, that at runtime there can not be executed another zip.exe maybe from your mingw\bin directory ??
I am quite sure. I have recently installed MinGW 5 (ad described in the C::B wiki), but I have no zip in the bin directory.
If I delete the path to zip.exe in the environmental variable Path and type
zip in the console, I get an error. Anway, even if I put the zip path in the Path, I still get zip failed with C::B. I have to put the zip.exe in the plugin directory to make it works.
In order to compile C::B I had to put the absolute path in the update.bat.
Michael